carson smith’s blog

Every Who down in Whoville liked Facebook a lot

Over the past few years, an economic grinch has packed much of America’s wealth into his bags. But as stocks tumbled, layoffs mounted, and foreclosures turned neighborhoods dark, a remarkable thing happened: we became happier. That’s if you put any weight in Facebook’s Gross National Happiness Index.

Based on analysis of positive and negative sentiment in status updates, the GNH’s goal is to be “indicative of how we are collectively feeling,” says Facebook. The index’s ups and downs are often tied to major external events. When Michal Jackson died, the GNH plummeted. And every Christmas, GNH is off the charts. But stepping back from the daily rollercoaster that is America’s collective mood, we can see a long term trend of growing happiness.

While gradual, we have seen approximately a three point overall happiness increase over the past three years. And even more substantial are the year-to-year increases in happiness during Thanksgiving and Christmas, up about 10 points and 6 points respectively. What could be causing this swell in cheery status updates?

Some insights can be gained by segmenting positive and negative sentiment separately. As it turns out, there has been a more substantial drop in negative status updates than the increase in positive updates. This may indicate we are not necessarily getting happier, just less upset. Here are 5 possible reasons for the trend:

1. Facebook demographics are trending older

College-age students once dominated Facebook. All the stress that comes along with finals, finding a career and relationships can add to the negativity factor. Recently, older users have been joining in droves. These new networkers are more settled in life, simply delighted to be reconnecting with friends, sharing little details of their life, pictures of family, etc.

2. Bush went away

Right about the time of Obama’s victory, there was an upswing in the GNH. No more need to post vitriolic tirades against the war-criminal president. Facebook users had hope, and so did their status updates.

3. Americans hate to admit they’re unhappy

Maybe we’re more depressed than ever? As companies let go thousands and houses foreclosed, perhaps out-of-work Americans were too proud to admit anything was wrong? Indeed, when you have to pull yourself up by the boot straps, complaining is not the best place to start.

4. We’re evolving socially

Chronic complaining is unattractive, but some people didn’t realize it until they joined Facebook. The more people posted negative updates, the more they realized their friends simply didn’t care. In this sense, Facebook could be acting as a kind of positive behavior reinforcer, because that’s the trait that’s most rewarded in social circles.

5. It’s easier to complain when life is good

The things people gripe about on Facebook are usually petty – a long metro ride, a terrible TV episode, or a bad professor. If you’re like me, you post these types of updates from time to time, simply to vent. But when bigger life events arise, such updates can seem almost decadent. If anything, America is a little less spoiled than it was three years ago. That can’t be a bad thing.

What do you think? Are we really getting happier? Why or why not?

Never again! That’s what most magazine publishers say to the rotten year that was 2009. With 25% average declines in ad pages, the industry simply cannot afford a repeat. But it’s not just the economy. As consumers flee print and flock to the web for content, it’s imperative that publishers get it right online.

While there are more online readers than ever, the fundamental problem for magazines is largely overlooked: magazine brand names are losing relevance — even on the internet.

Fewer people searching for magazine brands on the web

Of 140 magazines I analyzed using Google Insights for Search, only 31 publications saw increases in brand-name Google search volume in the last year. The average magazine experienced a 10% decrease in web search interest. And over five years (2004-2009), the keyword “magazine” has seen an astonishing 40% drop in its share of Google search volume.

With the proliferation of alternative content sources, the web eroding the brand name power magazines once held. People are no longer seeking out specific brands like Time, Newsweek or Discover. Instead, they use brand-blind information aggregators like Google. People may be reading more. But if readers don’t care where content comes from, publishers can’t claim the same value to advertisers on the web.

Here is a look at the change in Google search volume for some of the major magazine titles between 2004 and 2009:

What did People magazine do right?

Loyalty = brand advertising revenue

Print magazines are particularly appealing to brand advertisers because they reach a specific cohort of loyal subscribers every month. Kraft Foods, for example, might choose to place ads in Fine Cooking magazine for a year. They know their brand message will be repeated in front of a relatively constant audience 12 times. Not so on the internet.

When a Fine Cooking reader seeks out recipe information through Google, she might happen upon a random blog instead of Fine Cooking’s website. Kraft loses much of the control it has with the print publisher. But it does have another option: Instead of placing ads with a specific publisher, Kraft may chose to use an ad network across hundreds of websites and blogs. These ad networks can target specific demographic groups much like magazines. This makes Fine Cooking’s website much less valuable to Kraft.

Developing online loyalty

If traditional publishers want to survive online, they must develop new ways to their web readers loyal that are more effective than ad networks. This will give advertisers confidence they’re reaching a valuable audience that returns to view their ads each month – just like the print product. Some advertisers are even banning ad networks from their websites. But given the trends in brand name search volume, it seems publishers will be fighting an uphill battle.

A counter-argument – brands are dead

Some might argue that the internet has forever changed the way people interact with content. Brand loyalty as we once knew it will never again exist. Consumers have so much choice now, and it’s difficult to keep them around when cool new websites pop up every five minutes. So some publishers may decide to take a different strategy: forget about traditional brand advertising and go for volume-based direct response ads.

Direct response ads are different than brand advertising. They are about eliciting an action, as opposed to a soft and fuzzy impression that takes months to build in a consumer’s mind. Google has built its empire on direct response ads; they only get paid for the clicks. Imagine a magazine telling an advertiser it will only have to pay based on the number of calls it gets on the 1-800 number listed! It would never happen. Direct response advertisers care little about making you feel a certain way – they just want you to act.

Most traditional publishers are in no position to create a direct response-style strategy that can out-compete Google. Their strength is delivering the loyal audience that brand advertisers crave. But if you can’t keep a loyal audience, it’s the only option if you want to survive from advertising revenue on the web. Increasingly we will see publishers’ content strategies evolve to capitalize on the economic realities of the internet – and maybe some will beat Google at its game.

One thing is for sure: the magazine brand as we knew it will never be the same.

You may have recently read of media mogul Rupert Murdoch’s rumored plans to de-index his newspapers’ content from Google. “The Philistine phase of the digital age is almost over,” he proclaimed at the October World Media Summit in Beijing. He threatened that the likes of Google “will soon have to pay a price for the co-opting of our content.”

The casual observer might deem this idea mad, given that about 25 percent of The Wall Street Journal’s web traffic comes through Google. Indeed, comments on the popular social media blog, Mashable, lambast the 78-year-old industry titan:

“This guy is off his rocker.”
“What a greedy old fool.”
“Murdoch is just another in a long line of execs who don’t understand the technology.”
“Ok, this is probably the most ignorant thing I have ever heard.”

Sure, call the old billionaire foolish if you’d like. But there’s one thing Murdoch does understand: his newspapers may go bankrupt without a change in the online economic landscape. The business basics of the journalism industry today are grim:

• On the web, advertisers can now reach consumers very cheaply (Blogs, Facebook, etc)
• Traditional news publishers, who rely on ads to support costs, must compete at these cheap ad rates in the open market
• This revenue does not come close to covering the overhead of a major online news operation

In this business context, Rupert Murdoch can either work to protect his billion dollar empire, or let it go to the blogs, so to speak. Obviously he wants to do the former. So what’s his strategy after giving Google the finger?

A deal with Microsoft?

According to reports, Microsoft and News Corp have discussed a possible content deal on its fledgling search engine—errr Decision Engine— Bing. Desperate to increase its market share, some think Microsoft may be willing to pay for exclusive access to Mr. Murdoch’s content. But what about the lost Google traffic?

Analysts estimate that The Wall Street Journal makes about $15 million a year in ad revenue from Google’s search traffic. Given cash-rich Microsoft’s recent $100 million promotional campaign for Bing, it seems a no brainer to pay Mr. Murdoch well beyond a measly $15 million for an exclusive content opportunity.

Will the industry follow suit?

As one blogger put it, it’s a kind of prisoner’s dilemma. If one company leaves Google, the company that stays with Google will see its traffic and revenue increase. But if all news websites band together and jump ship, they could all collectively be better off.

Using elementary game theory, I’ve created a hypothetical example of how Mr. Murdoch might view the competitive business situation in favor of choosing a Microsoft deal. To simplify the marketplace, let’s imagine that there are only two players: News Corp (player A) and the New York Times Co (player B).

Currently, both companies allow their articles to be indexed on Google, generating in the neighborhood of $15M from that traffic. This scenario is represented by the upper left-hand box.

Now let’s say News Corp decided to move to Bing’s exclusive deal, while the NY Times Co remained indexed on Google. In this scenario (upper right-hand box), revenue increases for both. Why? Microsoft pays News Corp $40M per the signed deal. The NY Times gets $10M more in search traffic because News Corps content is gone from Google, giving it greater market share.

However, using logic, neither of the above scenarios would happen given the game’s conditions. Based on the revenue potentials, it makes most sense to chose Bing no matter what. Even though you’d make more money if you were the only one on Bing, it will not happen. Both are better off choosing Bing. While revenue will be slightly lower (their content is now competing for the same eyeballs on Bing, so Microsoft does not pay quite as much to each), it is still better than choosing Google.

Does this have any grounding in reality? Not really, because we don’t know what the conditions will be in real life. And according to an inside source familiar with the Microsoft negotiations, “the economics do not seem to be there for the common arrangement initially rumored to be under discussion.” One thing is for sure: the economics must change if News Corp wants to keep its newspapers. In an indication its willing to help publishers change their losing equation, Google today announced more options for news publishers to control their content.

Looking into the future

In America today, news publishing is a business. For these companies, the only right choice is the one that yields the greatest long-term profit. Given the rapidly changing media landscape, I’m not sure anyone can predict what will work best in 10 years. But I’m glad we have companies experimenting with different models. The sad part is that many ideas will fail, and more than likely, many journalists will lose their jobs in the coming years.

[W]e have in this country two big television networks, NBC and CBS. We have two news magazines, Newsweek and Time. We have two wire services, AP and UPI. We have two pollsters, Gallup and Harris. We have two big newspapers–the Washington Post and the New York Times. They’re all so damned big they think they own the country.

–Lyndon Johnson, 1969

If LBJ were still around today, he might be happy to know:

• After an emergency loan from a Mexican billionaire was not enough, The NY Times announced plans to layoff 100 reporters last week.
• “Nobody knows if they’ll have a job by the holidays” at the AP
• Time plans to layoff however many employees adds up to their $100 million shortfall
• The Washington Post lost $143 million dollars in the first half of 2009
• UPI doesn’t even exist (was purchased by Sun Myung Moon’s Unification Church in 2000)

Yes, LBJ, things changed. The old media aristocracy has fallen. In it’s place: the internet and cable TV. Media consumption is no longer a three course meal served on schedule, but self-made snacks served up on-demand.

Apple has become the entree du jour, prefixing its all its media consumption products with an “i”– connoting this new self service reality. With the flick of a finger, one can easily filter out influences that might be too foreign, difficult to understand or just plain boring. This proliferation of personal choice can have the effect of stymieing our own intellectual development; we no longer need to listen to anyone but those who confirm our own psychological needs.

Old media has caught on to this. In response to the new consumer power, the besieged moguls are fighting back by giving consumers more and more of what they want: junk food for an insatiable ego. The rise of opinion-based programming on cable TV is evidence of this. Fox “News” has built itself around right-wing pundit personalities, while MSNBC has responded by taking a stake out on the left. Meanwhile, middle-of-the-road CNN saw its lowest ratings in decades.

When left to their own devises, people tend to consumer media that confirms and even amplifies their personal preferences (see my blog post about YouTube ratings). It’s becoming a much more personal experience. As further evidence of this new paradigm, Yahoo is currently running a $100 million ad campaign around the world that has one message: it’s all about you!

So the power of the old media has been transferred to us. In many ways this seems like a good thing – more voice to more people, the very basis of our democracy. But is this choice and freedom uncovering a strain in human nature we’d rather not face up to?

The old media aristocracy functioned a bit like a benevolent dictator. It used its monopolistic power to extol journalistic standards like truth, accuracy and trust. It was far from perfect, leaving many voices out. And thanks to new media, niche issues like gay rights are becoming increasingly recognized. But at the same time, so are problems like racism and xenophobia permeating the media. And in place of the paternal void, consumers are increasingly gravitating to rogue media voices.

I witnessed the tea party protests at the National Mall last month. Never have I seen a scarier political sight in my life. Egged on by Fox News pundit Glenn Beck, angry white marchers descended on Washington to spout ugly racist slogans. One older black man told me he had not felt so much hate since the 1960s.

No longer bonded to paternal media overlords, one might argue that we’re in a state of nature. This unprecedented freedom of information may be the ultimate test of the old Locke vs. Hobbes debate.

Ben Franklin was a busy man. Not only did he invent bifocals, iron stoves and the odometer, but he founded one of America’s first magazines. Creatively titled The General Magazine, it unfortunately did not enjoy the same success as his other innovations. In fact, it was a complete failure, folding after only 6 issues.

The General Magazine

If the father of American invention could not run a magazine, who possibly could?

Up until the late 19th century, the answer was really no one. Magazines were read by an elite and erudite few who paid a hefty price for mostly European lifestyle writing.

But once the postal service offered second-class mail, magazines were democratized. Now everyone had access to high-brow literature reviews, fashion and cultural critiques.

And they devoured them. Magazines such as McClure’s offered a glimpse into a lifestyle many Americans could only imagine – all at the rock bottom price of 15 cents in 1883. By the 1920s, there were thousands of magazines and millions of readers.

What was the secret elixir to their success that Franklin could not fathom?

Advertising, of course! Magazines realized they could offer consumers quality content for next to nothing, placing the bill on businesses who wished to market their goods and services to readers.

The aspirational and largely unattainable lifestyles depicted in magazines appealed to Americans eager to improve their social status – just as it did to the advertisers whose products promised to help them keep up with the Joneses. While originally born out of a European elitism, advertisers substituted the old-world class-consciousness with more modern version: tangible products that symbolized the same psychological complex – in a more profitable fashion. Magazine publishers feed these ever hungry advertisers with more and more “sellable content.”

The 20th century saw the rise of publisher Condé Nast , whose lavish magazines have become the embodiment of this americanized form of European elitism. Vogue, Self, Glamour, Allure, GQ, Details, Vanity Fair, Architectural Digest are just a few of their titles that have scored big time with advertisers who understand class anxiety better than any French postmodern cultural theorist.

The empress of the Condé Nast empire, Vogue editor Anna Wintour, was profiled my Meryl Streep in the film The Devil Wears Prada. Condé Nast gives her a $200k yearly clothing expense account, personal drivers, not to mention a private jet.

All this brings us to 2009. This year alone, advertising pages across Condé Nast publications have fallen by 8,000 pages. Their empire has collapsed.

The decision of a team of cost-cutting McKinsey consultants was made public today: Condé Nast will close three publications, including Gourmet magazine. Readers on the NY Times media blog went ballistic:

Wow!!!
My family is heartbroken.
This is unbelievable!!
I am devastated
I am in shock
This is terrible news.
I am very sad about this.
Along with over 600 other mostly mournful comments

RIP Gourmet

Should we really be sad, though? Through the 20th century, the publishers of Gourmet had managed to run a very profitable business. But without advertisers paying to reach readers, that business cannot exist.

If the closure of Gourmet offers any lesson, it is this: the magazine industry never really cared about you – it ultimately cared about selling advertisements to you. You were fooled.

If Ben Franklin were still kicking today, I think he’d understand. No one wanted his magazine. What they did want were his unique and original ideas that offered tangible value to society.

As a former subscriber to Gourmet myself, I’m admittedly a little sad about the closure. But I’m optimistic that publishers will learn to create value in ways that benefits the health of society more than simply titillating the taste buds of naive consumers. I think we can all subscribe to that.

Ever watched a lame video on YouTube? Odds are you didn’t rate it. Today, the Google-owned video sharing website released the following graph on its blog that supports this quite convincingly:

As you can see, any video with less than a score of awesome (5 stars) garners almost no rating action at all. Are YouTubers that nice?

Personally, I’d argue they are lazy. Why spend the time to express an opinion about something that does not make a strong impression?

Using this thesis, it should follow that almost every oft-rated video on YouTube is totally awesome. But if you spend a little time browsing their popular categories, you’ll soon discover this is not the case.

There are lots of what I’d deem lame videos on YouTube’s most popular pages. Here are I found this evening:

What do you notice about these lame videos? Yes, they all get nearly a perfect 5-star rating!

Why?

I think the answer is simple: people have different tastes. And therein lays the problem. If only 5% of the population thinks 10-year-old Suzie’s sleeping goldfish is cute, it will still get 5 stars because the others will not rate it.

As a result of this, a lot of YouTube video ratings are misleading because they capture only the positive sentiment of very niche audiences. If you think about it, almost any user generated review could result in this kind of bias.

Maybe Roger Ebert will still be relevant after his newspaper goes bankrupt?

If there’s one quintessential symbol of masculinity in America, it’s the cowboy. Steady, sure, tough, a bit gruff rough, he is a powerful cultural archetype — and brand. From selling millions of cigarettes, country songs, and SUVs to electing at least two presidents, his selling power cannot be underestimated. But is the love affair over?

America’s obsession with the cowboy as a masculine ideal has been waning for some time. Let’s mark a few of the mile stones:

• The Marlboro Man dies of lung cancer.

  Under the reign of a cowboy-branded president, America is lead into a foreign policy nightmare and an economic depression.

  A film comes out about gay cowboys and is widely accepted.

The cowboy’s image has transformed from one of venerated idol of male strength to a fraud, or impostor of sorts. But it’s more than the cowboy. It’s the broader brand — the American masculine ideal. And it is fading. This is a huge cultural paradigm shift.

Enter Obama, the Anti-Cowboy

As the child of a single mother and an absent father, Obama is a fitting symbol of a post-masculine society. In a column last year, NY Times columnist Maureen Dowd emphasized the contrast between Obama and the cowboy: “Obama proved that he was not a cowboy in overdrive like W. when he demurred at throwing a spiral because his pass might not be as good as the Longhorn stars’.” What about Hillary, you might ask?

In her column, Dowd argued that “Hillary was so busy trying to prove she could be one of the boys .. that she only belatedly realized that many Democratic and independent voters, especially women, were eager to move from hard-power locker-room tactics to a soft-power sewing circle approach.”

As the Obama/Hillary example illustrates, the male vs. female dichotomy less central then the actual expression characteristics of masculine vs. feminine. It is not so much that masculinity is going away – it is that femininity has become the more dominant cultural force.

Implications for brands

The recent TV series Mad Men aptly characterized the male-centric world that gave birth to the advertising industry. The legendary Leo Burnett is one of the most influential of these agencies, having shaped many of the brands that you grew up with. In addition to the hyper-masculine Marlboro Man, they have developed other male-centric figures including “Charlie the Tuna”, “Pillsbury Doughboy”, 7UP’s “Spot”, and Tony the tiger.

But even more important than the fact these brands symbols are of male gender, is the masculine way they are communicated. Their top-down, one-way approach of talking to consumers is very much a masculine “don’t-talk-back-to-me” style. The feminine approach, by contrast, is not about telling, it’s about conversation.

The rise of social, cause-centric, conversation-based media

The green movement, social media, good-cause marketing are all central to the feminization of brands. Tending to be feeling-centric, brands are now asking you to chat with them on platforms ranging from Facebook to Twitter. In the masculine world of brands, this would have been unheard of. As technology gives greater voice to the average citizen, it allows us to communicate more collectively. And it’s the feminine conversation ability that is emerging as most effective way to navigate in the world.

Now we see once exclusively macho brands are now exploring their feminine side. Look at this General Motors magazine ad from the 1970s, emphasizing the truck’s inner strength and robustness. Nothing could be more macho.

Now take a look at a recent online ad. Instead of emphasizing its source of power, this ad does the opposite. It says we use less power. And we are friendly. The feminine curling leaves invite the viewer into an entirely different brand experience.

The cowboy has faded into the sunset. But don’t count him out. Culture ebbs and flows. Brands that focus on the underling archetypal themes, both dormant and expressed, rather than the popular flavors of the day, will enjoy the greatest long-term success.

Orange farmers can’t be happy. Tropicana’s celebrated “Squeeze” rebranding campaign – entailing a complete package redesign and massive national ad campaign – sent sales sailing down 20% between January and February, according to Ad Age.

“No dots to connect here,” a company spokeswoman told the advertising trade magazine when asked about the correlation between the rebrand and drop in sales. Never mind the fact that Tropicana swiftly reintroduced the old packaging last month. In stores now, new vs. the new old:

Let me connect the dots that their dotty PR department can’t seem to find:

Unlike milk, orange juice is one of those grocery items that consumers can be a bit more discerning towards. We’ve all had that watered-down generic juice. Yuck. Over the years, brands have built success by taking advantage of the disparity in quality to emphasize taste, freshness, and added-value benefits like vitamins and calcium. To get some perspective, let’s take a look at the history of orange juice ads:

Sunkist’s “Drink an orange” campaign sent sales souring when introduced to thirsty Jazz Age families. While influencing consumers may have been easier back then, it’s hard to argue with the 300% revenue growth Sunkist experienced. Albert D. Lasker’s now famous campaign was all about the orange, not the murky pale yellowy liquid in the glass. And consumers ate it up.

Ever since the Sunkist success, advertisers have emphasized the bright, fresh, ripe orange – while putting that pale yellowy liquid or concentrate further behind the scenes. The following is an undated industry promotion ad, making the connection as literal as it could possibly — nothing can get between you, and the orange:

Modern orange juice advertising has changed little in its approach. With increased competition between major multinational corporations, the positioning strategies have tended to focus more and more on that orange. It’s about whoever has the freshest, most healthy, and natural orange to offer. Florida Natural’s positioning literally positions the product as part and parcel of the orange grove itself:

Tropicana has traditionally maintained a similar approach, their ads and packaging emphasizing the same old orange. You’re literally drinking the juice right out of the fruit:

Understandably, the good folks at Tropicana may have been getting a little tired of the same old orange every year. So they did something about it. They hired by “renowned” branding guru Peter Arnell to completely reinvent the nature of orange juice advertising.

Enter “Squeeze”

“It’s time to remind consumers that Tropicana Pure Premium is pure, natural and squeezed from fresh oranges,” said Peter Arnell in their campaign press release. So far this sounds like the same old same old. But he goes on: “In order to reinforce this message, we focused on the health benefits of the juice but showed it in a more emotional way than ever before in this category. We want to remind consumers how it should feel to drink this juice every morning.”

In other words, Mr. Arnell decided to put the orange in the back seat. And the ads – which have been widely praised within the industry for their “boldness” – do exactly this. No oranges to be found. Instead, we see parents literally squeezing their kids – feel good photography emphasizing the campaign’s operative word: emotions.

The ads are certainly pleasing to the eye. I can’t find anything particularly unappealing about them – nothing noteworthy enough to drive sales down 20%. But this is part of the lesson: the advertising campaign did absolutely nothing to increase consumer interest in the “emotional brand experience.” While the images themselves probably did not turn people off, they didn’t make any connections to the product. Here’s is what you found in the grocery isle:

‘

The product on the shelf is emotionless, almost generic. It has a cold, detached feel that in no way correlates to the happy families pictured in the ads. But the most egregious error has nothing to do with the happy families – they are really just as superfluous as the whole ad campaign itself.

It is about the orange.

Indeed, the rebranded package does say “100% orange.” But what kind of orange?! “100% orange” is printed atop that murky pale liquid that orange juice advertisers have tried to avoid for almost a century. To the average shopper, it is nothing more than a color. In their attempt to imbue the word “orange” with an emotionally branded meaning, Tropicana successfully disconnected it from the fruit that bares its name.

Lessons learned:

• Ad campaigns are ineffective if not directly attached to the product itself.
• There must be a clear connection between the product and the “brand experience.”
• Prestigious ad agencies and brand experts sometimes know less than the average consumer.