Saturday, March 31, 2012

How the Washington Post Uses Data to Crack its Registration Problem

By now readers of free online publications understand that registration is an unfortunate necessity of the business model. Begrudgingly, we accept that registration information is used to deliver better targeted ads, which boosts revenue and keeps the paper free. Even though we know it’s a pretty good deal and we’re sick of those pesky pop-up reminders, most of us just don’t get around to registering.

This is a big problem for free publications like the Washington Post.  Not only do we not register, but when we are given the ultimatum of register or be denied access, we almost always leave the site.  This means the registration prompt is a pivotal moment for Washington Post’s business model – a fork in the road to profitability. 

The challenge for the digital team at then, was to make the value exchange of “registration for access” more appealing to consumers. 

To figure out how to do this, Washington Post implemented technology in order track how people use their website. This transformed readers’ behavior into valuable data.

The data revealed a counter-intuitive conclusion: It turns out readers are more likely to register deep within an article (for example, in between pages 3 and 4) than after clicking on a headline or exceeding an article allowance. 

This discovery disproved a golden rule of online media: Never disrupt the user experience. 

It turns out that disrupting the user at the pinnacle of engagement (meaning deep within an article), is actually the best way to get the reader to register. The key insight is that the reader finds the proposed value exchange of “registration for access” more appealing when it includes the added benefit of being allowed to finish an article s/he is deeply engaged with.

With this model the reader actually has a much better experience than the one who has to “x” out and be turned away from an article.  

The disruption helped Washington Post achieve its business objective and improved the user experience. 

This is a case study for how data can unearth insights that are contradictory to marketing best practices, even common sense. It’s also a testament to the open-minded and innovative culture at Washington Post who had the conviction to implement this optimization.

Tuesday, March 13, 2012

Stop Kony and the Power and Danger of Viral Activism

The Stop Kony campaign is a watershed moment for social media. Even as the credibility of the campaign has crumbled and the movement itself has fizzled, Stop Kony has established a legacy greater than its intended cause – it revealed the full potential of social media’s political power in America.

The Stop Kony movement is distinguished for two reasons. First, is the speed in which it galvanized the greater part of American youth on one side of an idea. Second, is the fact that the idea is tied to social or political change. The combination of these two factors represents the arrival of viral activism in the USA and a turning point for democracy in this country – not necessarily for the better.    

A lot of the debate concerning Stop Kony is focused on the merits of the cause, but that misses the point.  The much bigger story is the very fact that Americans used social media to move in lockstep to advance a political or social agenda. Their power was astounding – within days their cause was on the front page of the New York Times and they presumably helped raise millions of dollars. 

That the movement itself may actually do more harm than good encapsulates the danger of viral activism – the unfortunate risk that comes when 75 million people are mobilized by a 30 minute video on a topic they know nothing about. 

This sort of recklessness strikes at the heart of the issue. The swift pace and mass reach of Stop Kony is an example of how social media can become more powerful than mainstream media. For so many viewers of Stop Kony, objectivity, fact and reason, the traits of the American free press, bowed to the raw emotion of “the cause”, illustrating the mob-like mentality of viral activism.

The stunning thing about Stop Kony is that it managed to captivate the entire country on nothing more than a YouTube video, a purportedly righteous cause and a tweet from Oprah. This was not lighting in a bottle but rather a case study for every grassroots and political organization that wants its agenda heard. Stop Kony was engineered to go viral and it succeeded. Imagine if this sort of manipulation was executed by the Republican or Democrat party a few days before the election? After Stop Kony, Ugandan politics may remain unchanged, but American politics may never be the same. 

Sunday, March 4, 2012

Facebook, Google+ and the Race to Monetize Your Identity

“Right time, right place” is how industry insiders sum up the potential of online advertising. It’s a tantalizing idea – that online marketers’ ads can appear at the precise moment the viewer is most receptive. Any company that could make that holy grail of advertising a reality, well, it would be worth 100 billion dollars!
Wall Street hopes that Facebook can deliver on the promise of “right time, right place” because of the scale, depth and quality of the data Facebook collects from its users. Facebook combines the demographic information of the 845 million people who use its service with a relentless stream of Likes, Check-ins, comments and other actions that give it a textured understanding of exactly who those people are. Facebook’s data is unique in that users actively share their identity with Facebook, then utilize the site’s many functions to fine tune their image. This stands in stark contrast to its competitors in the display advertising business like Google, who observes users as they passively share information. Facebook shows an ad to the real you, while Google shows an ad to who it infers to be you.

The difference in quality between Google and Facebook’ data was on stark display this past month with the amusing discovery that Google thinks just about everyone is a 35 year old tech-savvy male. Google is all too aware of its inferior data and has made its pursuit of your identity the company’s number one priority. In fact, all of Google’s employee bonuses are tied to the success of its social network Google+. (Click here to see who Google thinks you are.)  

The quality of Facebook’s user data is so superb that it warranted a $100 billion valuation from Wall Street.  “Right time, right place” may be the holy grail of advertising, but given Facebook's $100 billion valuation, that may be exactly what Wall Street is expecting.

Read More:  Facebook IPO Cites CEO Zuckerberg Among Risk Factors

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