Unconstitutional. It’s such a cool word. As an American, it evokes the most powerful feeling of wrong. It doesn’t matter what it is, if it’s unconstitutional, you know it’s wrong.
Guess what the Harvard Law Review called unconstitutional. The FTC’s Endorsement and Testimonial Guides covering consumer generated media. The one that told bloggers that you had to disclose certain things if you wanted to write about it. The one that made you feel like some kind of slimy lowlife for being influential enough to be asked to test free products. The one that said newspapers didn’t have to disclose anything at all.
There are many parts of the Guidelines and the FTC’s actions that troubled me. First off, the thought that any group of people could smartly legislate something so nascent and developing like social media seemed like a non-starter. The brightest minds in the country don’t know where social media will take us…where is the value that will be pursued? what are the metrics that will be measured? what is the activity that will be developed? Sure, if there is obvious social malfeasance going on that is not readily fixing itself, then the government can say they are compelled to take an interest no matter what stage an industry is in. Especially if you’re just extending rules you have in place for, say, legacy media. But I really had to ask myself whether the need to identify those bloggers who partied with Ann Taylor required the government to set new rules for emerging media that differ than those for legacy media? And while I’d love to hear the FTC opinion because I’m sure they’ve studied it carefully, I think issuing Guides as opposed to encouraging discussion was irresponsibly, innovation-chillingly early.
The second point of trouble for me was the apparent limiting of free speech that I thought the guidelines promoted. Having helped develop one of the only open social platforms for consumer product discussion, I am especially sensitive to anyone telling me what my members can say, how they can say it, and pretty much any interference at all. Being brave enough to let total strangers benefit from your experiences is just one of the overwhelmingly powerful advances of the new social web. Therefore, what bothers me is the encroachment on my community’s free speech on a platform specifically built to let them speak in a safe, relevant and helpful environment. I work on it every day, and have for years. We are constantly debating what the exact right mix of moderation, disclosure, community mores, and content guidelines is best to make our our library of experiences valuable and helpful to other consumers. The market, our clients, the community, and the users of our content are still helping us determine what is helpful, what is irrelevant, what is valuable. If I had known the FTC had all the answers, it would have saved me a lot of entrepreneurial time.
Before stepping in and potentially chilling innovation or free speech, the government should always ensure that 1) there is a compelling state interest and 2) the limitations on speech they put in place are as tightly defined as possible. I don’t think either has been addressed in these Guides.
At the risk of being Googled by the FTC, and because I’m not a lawyer so I didn’t really have a cogent POV, I didn’t write much about it. See my very ‘factual’ blog post here. So, I was happy to read that while the Harvard Law Review wasn’t as morally outraged as I was, they were as legally peeved. I first found the HLR article through some bloggers, and even loved that the HLR cited a blog in their article. All this analysis (some more emotional than others) gave me the backbone to write about it now.
The Headline: Unconstitutional
Within the first paragraph, the HLR stated “the Guides should be ruled as unconstitutional as applied to unpaid bloggers.”
The reaction in the blogosphere to the FTC’s announcement of the rules was unsurprisingly negative. Bloggers expressed particular concern that the rules were overbroad, exceedingly vague, and expressly did not apply to legacy media. Bloggers are right to be upset; the Guides violate the First Amendment. The Guides treat blogger endorsements as advertisements and attempt to regulate them as such. Unlike other speech, advertising is considered commercial speech and thus receives reduced First Amendment protection. However, under current Supreme Court doctrine, unpaid blogger endorsements should be classified and be given the same protection as noncommercial speech, just like product reviews found in traditional sources. Courts should therefore apply strict scrutiny to the Guides and hold them unconstitutional as applied to unpaid bloggers. The burden the Guides impose, as well as the unfairness of holding bloggers to a higher standard than legacy media, supports this result. (HLR)
There is a high bar to defining speech as commercial speech
The big revelation in the HLR article that is never addressed in the FTC Guidelines, but I think should be, is why they have determined blogger writings are “commercial speech”, and therefore subject to FTC legislation. Non-commercial speech, as you can imagine, is well protected by the First Amendment. So when does speech that you say, write or video cross the chasm from non-commercial to and turn into commercial speech? There’s actually a test that has been developed through the courts. It’s called the Bolger test, and it is very tightly defined since the threat to infringing on non-commercial speech is very serious business to the law. There are three pieces of the Bolger Test, and if all three are positive, then there is ‘strong support’ that the speech is commercial:
The speech refers to a specific product
The speech is conceded to be some sort of advertising
The speaker “has an economic motivation”
The last one…the speaker’s economic motivation needs to be “where the speaker’s main goal is either to sell his own products or to get paid by the product’s manufacturer.” (HLR) Clear cut cases of commercial speech include where the blogger was employed by the manufacturer to blog about their products in a positive light. A direct economic relationship seems to be nothing short of: “I pay you directly in exchange for stating these positive things about my product.” Anything short of that should fail the Bolger test and be seen as noncommercial speech. Free product that is not directly tied to your agreement to write a positive review in return is not a black and white case to be legislated. The HLR states, “Even where a blogger’s positive endorsement might yield a benefit in the form of free products in the future, the blogger’s speech is not fundamentally premised on a direct economic relationship between the company and the promoter.”
Assuming the FTC considered the Bolger test in order to decide it had the right to legislate your language, it seems to be concluding that the economic benefit of receiving free products in many cases is the main reason you wrote favorably about the product. It overrides the possibility (probability?) that sharing your expertise and experience with others was actually the main reason you wrote about the product, and getting the product for free was the way you could accomplish that. The possibility (probability?) that you thought you had some kind of expertise that would be worth sharing with others regarding the evaluation of the product, as opposed to the need to get someone to send you a freebie. No, by broadly sweeping free products within their authority, the FTC is stating that the main reason you wrote positively about that product was simply because you wanted to get that free product, or more of it. It’s a demeaning and dangerous overreaching.
Why should the FTC’s disclosures bother me as a blogger?
Make no mistake that by requiring disclosure, the FTC is saying that your opinion is commercial and you wrote your content in order to receive a freebie. Your content is seen by the FTC as no less biased than if you were sent a paycheck by a manufacturer and your staff title was “Positive Blog Poster About Our Products”. By requiring you disclose your bias, the government is saying that your speech is equivalent to an advertisement, and not free speech. The government believes they need to protect people from your point of view, and seek to diminish the impact of your opinion with a disclosure.
A blogger who does not wish to disclose receipt of free products may seem an unsympathetic case, but there are nonetheless important free speech principles at stake. The Guides require disclosure of the mere fact that the product was provided for free, whether or not an endorsement was written in exchange for free products. This required disclosure directly interferes with the content of the speaker’s expressive message. Disclaimers have an “inherently pejorative connotation” that reduces the effectiveness of the message, even if the speaker is acting in good faith. In addition, restricting a blogger’s receipt of free products makes it more difficult for the blogger to write any product reviews at all. Thus, in the name of protecting consumers, the Guides would deprive consumers of information. (HLR)
The HLR then even showed a better guideline that the FTC should have employed if it were going to opine about disclosure in order to not be found unconstitutional. The HLR suggested that FTC should have narrowed its recommendation that any actual quid pro quo between the endorser and the advertiser be disclosed (i.e., “If you do this, I will do this.”), or if there was actual intent to deceive the public. The HLR is saying, yes, the FTC might have been okay if they ruled that employees of manufacturers with the job “Positive Blog Poster About Our Products” should disclose that. But by lumping in all recipients of free product and not utilizing the tests for commercial speech clearly defined in court precedence, the FTC’s Guides were overbroadly infringing upon a basic right of free speech.
Favoring one type of media over another: A warning sign that you’re doing something wrong
The HLR took specific attack on the FTC for segregating speech in legacy media (ie newspapers) as being exempt from the bias that they put onto bloggers.
The FTC asserts that knowing whether a blogger received a product in exchange for consideration “might affect the weight consumers give to his review,” whereas knowing whether a newspaper paid for an item would not. But this distinction is unfounded. The material relationship between an endorser and a manufacturer includes not only the value of the free product, but also any other transactions in which they engage, like the purchase of advertising space in a newspaper. Paid advertising is a far more serious conflict of interest, both because its value is likely to be far more than the value of a free product, and because legacy media, unlike blogs, depend on it for their very survival. (HLR)
After centuries of scrutiny, imagine how high the bar needs to be for the Government to be able to interfere with the speech contained in the newspaper you read. The FTC has given our individual speech, now recently given greater exposure through the advancements in the web, less consideration. The HLR summarizes better than I could:
The Court has already ruled that the government may not legally prescribe editorial standards for newspapers; to do so would violate the First Amendment by interfering with newspapers’ “exercise of editorial control and judgment.” Yet the principle underlying the Guides is that the FTC may distinguish between blogs and newspapers based on its perceptions of “editorial responsibility.” Even if bloggers are, on average, less “editorially responsible” than print media, allowing the government to favor certain media forms would allow it to manipulate the “marketplace of ideas” just as direct interference with editorial content would. Worse, favoritism may encourage favored media to moderate their criticism of the government. As consumer-generated media gain an increasingly important role in our society, they should receive the same robust speech protections enjoyed by legacy media. (HLR)
Obviously, there is more to come on this subject, and more shoes to drop other than a few blog posts. I look for challenges to whether or not the Guides were necessary to achieve a compelling state interest, and to watch the FTC try to demonstrate that the legislation is narrowly tailored to achieve the intended result. Short of this, the policy should be radically reigned in.
Can anyone see any similarities? If you said, “This seems like the launch of an EXPO eCommerce Network, or the XEN,” then you’re right!
What you notice with these past three releases is that we are announcing further and further distribution extensions of our video catalog. These extensions are very targeted…
ALICE.com is the hottest new CPG distribution concept in a while
The eStore is the groundbreaking etailer exclusively dealing with P&G products
SellPoint is a vendor relationship that can distribute rich media content to the product pages of hundreds of retailers on a turn-key basis
These extensions are on top of distribution to leading commerce engines shopping.com and smarter.com.
EXPO has a mission of putting our video “wherever people need product information”. As we watch that number of ‘wherevers’ fragment further and further, EXPO has created a turn-key solution to reach far flung destinations. With 300,000 digital video assets and a flexible media management system, EXPO can power relevant video instantly across targeted, ROI-driven retail partners. More announcements will be made in the coming weeks, so stay tuned.
Of all the things in this release, the thing I like the most is “enjoying strong growth”. Welcome to some awesome new board members.
New Directors Join Board as Company Enjoys Strong Growth
NEW YORK, NY–(Marketwire – July 7, 2010) – Citing rapid client growth, EXPO announced an expansion of its Board of Directors from four to six members, with several changes that dramatically strengthen its composition. New members include Pete Blackshaw of Nielsen Online Strategic Services, “Kam” Kamerschen, Presiding Director of the Board of MDC Partners and Thayer Bigelow, former President of Home Box Office and Time Warner Cable Programming.
Blackshaw, who is frequently cited by publications including the Wall Street Journal and BusinessWeek, has been a leading thinker on social media for over a decade. Pete was part of the team that first headed digital initiatives at Procter & Gamble. Blackshaw later founded PlanetFeedback, Inc., which now forms part of Nielsen Online. Blackshaw is the author of “Satisfied Customers Tell Three Friends, Angry Customers Tell 3,000.”
“Pete is a pioneer in the areas of user generated content, customer listening and all of the other concepts we now call social media,” said EXPO President Bill Hildebolt. “People think these are new concepts, but Pete has been practicing them since 1997 and to have that credibility on our Board shows the impact we’re having with global brands.”
Robert “Kam” Kamerschen is a highly sought after Board member who is currently active as the Presiding Director of MDC Partners and has served as a board member at IMS Health, Radio Shack and elsewhere as well as with numerous private company boards. Previously he was CEO and Chairman of ADVO, Inc. and also held CEO roles at RKO/Six Flags Entertainment and MaxFactor. “We are extremely grateful to have Kam involved,” noted EXPO CEO Daphne Kwon. “His experience across the corporate life cycle and his connections to companies large and small have already been invaluable as we continue to accelerate our growth.”
Thayer Bigelow, a long time investor in the company, spent more than 30 years working for Time, Inc. and Time Warner in various senior roles at HBO, Time Warner Cable Programming (and its predecessor company) and Court TV. In addition to EXPO, he currently serves as a Board Member at Lord Abbett Funds and Trinity College. ”Thayer personifies the concept of a value-added investor,” said Kwon. “His support of EXPO since inception has been key to our success today.”
“Expo is breaking new ground,” said Kamerschen. “Their marriage of consumer generated video with product reviews, how to videos and other purpose-driven content is giving companies fresh and actionable insights into their brands and creating new standards of authenticity and transparency for consumers. I think I speak for all of the Board members when I say I’m excited to be part of it.”
I’m so proud of the effort by our marketing maven, Jess Thorpe, who made it easy for people to donate to the Red Cross through their membership points with EXPO. The additional incentive of a cashless transaction hopefully will make this a great service for EXPO to offer to our members and Haiti.
In-home video research used to cost an astonishing amount of money. Think about it…how much would it cost to hire a camera crew to follow someone around? You had to screen and qualify applicants (you might not even know what they look like or sound like), you had to hire a camera crew for no less than a full day (even if you were interested in just one sliver of the participant’s life). Nothing could be done quickly — you had to coordinate schedules of applicants and crews, and make sure everyone knew what was supposed to happen. Imagine the costs if you wanted to follow the participant to measure their reaction over time!
And even after all that, what are the chances you could get an authentic, sincere response from the participant, with a bunch of strangers and equipment invading their home?
Marrying the skillset of user-gen content, and the comfort of social media, EXPO has been able to harness the power and knowledge of our community to tap into video ethnography for a fraction of the cost. We can hyper-target a demo, or screen by qualifying questions, and then provide very detailed assignments to our community. This level of care results in a broad video ‘picture’ to accompany research findings. We’re calling it “Kitchen Table Conversations“, to evoke the sense that people are really inviting you into their homes, where they’ve always been most comfortable sharing their lives with you.
In times when social media has made putting personal videos and pictures on public display passe, it’s hard to imagine trying to make a research point without showing real faces in their real words. We recently did a video ethnography for AdAge in conjunction with JWT, on the “Rise of the Real Mom”. We think that EXPO helped AdAge capture the triumphs and tribulations of the unsung heroes that have helped this nation get through the financial crisis…moms!
UPDATE: Will Richmond from VideoNuze did a MUCH better job explaning KTC than I did. I guess the power of being a neutral third party.
PART I. THE QUICK READ JUST FROM THE BLOGGER POINT OF VIEW
The FTC guidelines for endorsements have been published and can be found here. There are three main sections of interest to bloggers, and the marketers who support their voice.
1) Definition of endorsements/testimonials
2) What is required of the consumer contributors and marketers
3) Disclosing ties to marketers
Additionally, there is a fourth part that concerns only the marketer, which comes into play if they use/feature the blogger’s testimonial in an advertisement. Then, common sense would kick in that the content needs no less care than they apply when they write a scripted ad, such as claims reviews. I’ve not covered that here due to the inapplicability to bloggers on how marketers use their content, but will in future postings.
The FTC seems to be focusing on bloggers “because he or she is known to have wide readership within a particular demographic group that is the manufacturers’ target market.” By acting as the ‘speaker’ of the content, and also as the publisher of that content to their audience, the FTC seems to believe that the blogger was selected by the manufacturer to receive some benefit (ie free product, payment) because of the blogger’s direct ability to spread the message to their target market. The FTC seems to equate a blogger’s following with a celebrity’s following — and indeed celebrities are similarly covered in the new Guides. Essentially, the blogger was acting as a conduit for a marketing message to be delivered to his or her following. If the blogger chose to deliver that message, the blogger becomes part of the direct advertising chain.
While the main guidelines begin on page 55, there are a lot of interesting materials in the “Supplemental Information” that covers consumer generated content, including around pages 8-15, a39 and 51. I’ve summarized and tried to interpret from my non-legal reading of the document. The following are some more detail on the three main points for bloggers and other consumer contributors.
1) Definition of an endorsement or testimonial covered by the Guide
The FTC is saying that anytime there is a known, agreed upon tie between the blogger and marketer, this is an endorsement. Here is an example that they used to help you determine what they’re looking for as a tie between you and the marketer.
Example 8: A consumer who regularly purchases a particular brand of dog food decides one day to purchase a new, more expensive brand made by the same manufacturer. She writes in her personal blog that the change in diet has made her dog’s fur noticeably softer and shinier, and that in her opinion, the new food definitely is worth the extra money. This posting would not be deemed an endorsement under the Guides.Assume that rather than purchase the dog food with her own money, the consumer gets it for free because the store routinely tracks her purchases and its computer has generated a coupon for a free trial bag of this new brand. Again, her posting would not be deemed an endorsement under the Guides. Assume now that the consumer joins a network marketing program under which she periodically receives various products about which she can write reviews if she wants to do so. If she receives a free bag of the new dog food through this program, her positive review would be considered an endorsement under the Guides
The FTC included some “supplementary information” to help clarify their position, especially based on the thoughtful comments provided by some of our colleagues at WOMMA and BzzAgent. The FTC said that they would need to look at the overall relationship between the blogger and the marketer, such as:
Whether the speaker is compensated by the advertiser or its agent
Whether the product or service in question was provided for free by the advertiser
The terms of any agreement
The length of the relationship
The previous receipt of products or services from the same or similar advertisers or the likelihood of future receipt of such products or services
The value of the items or services received.
These would go into the decision whether the blogger was disseminating a marketing message to his or her following. My advice to bloggers is not to spend a lot of time trying to decide if you are covered by these definitions. If you’re not sure, err on the side that you are. The FTC believes that the advertiser selected you to blog about their content because you have influence with your audience. Therefore, the FTC wants to ensure that your communication over the audience you have built is taken seriously when an advertiser-requested message is attached.
2) Taking responsibility for what you say in your content
When something is considered an “endorsement” and covered by these Guidelines, what needs are your new responsibilities expected by the FTC? Basically, they want you to take responsibility for what you say and how far you go when describing the product benefits. You shouldn’t make product claims that aren’t your personal experience with or opinion of the product. For example, you shouldn’t say that the product will do the same thing for everyone since you don’t know that is 100% true. If you do, the FTC believes you should take responsibility for these claims that are misleading or not supported by evidence. That’s what marketers currently do when they write ads and tout claims. They have to back up everything they say with evidence.
The FTC believes that marketers should help guide you in the types of claims you can make, and monitor your content to make sure it conforms. However, it believes that you and the marketers share liability since you’re both in a relationship together.
An observation from the Guide: The FTC seems to take a position that if you speak about your personal experience with the product, and keep it to your own opinion of the product, that this may not be making a product claim. I’m not quite sure about this yet, but there was some language that seemed to imply that.
3) Your responsibility includes disclosing your relationship with the marketer
This section is simple to the extent it is what it says. If you have a relationship with the marketer, you should disclose it. As discussed in the definition of an endorsement, the relationship can include where you are paid or get free product. Again, my advice is not to quibble with whether you are covered, and simply disclose whatever relationship you have with the marketer. The Guides don’t really discuss how to disclose the relationship, but it should be obvious and clear to anyone that is reading your blog.
The blogger is also liable if she fails to disclose clearly and conspicuously that she is being paid for her services.
For example, an individual who regularly receives free samples of products for families with young children and discusses those products on his or her blog would likely have to disclose that he or she received for free the items being recommended. Although the monetary value of any particular product might not be exorbitant, knowledge of the blogger’s receipt of a stream of free merchandise could affect the weight or credibility of his or her endorsement – the standard for disclosure in Section 255.5 – if that connection is not reasonably expected by readers of the blog. Similarly, receipt of a single high-priced item could also constitute a material connection between an advertiser and a “sponsored” endorser.
If the blogger is actually paid by the advertiser or a third party acting on its behalf, disclosure certainly will be warranted.
Example 7: A college student who has earned a reputation as a video game expert maintains a personal weblog or “blog” where he posts entries about his gaming experiences. Readers of his blog frequently seek his opinions about video game hardware and software. As it has done in the past, the manufacturer of a newly released video game system sends the student a free copy of the system and asks him to write about it on his blog. He tests the new gaming system and writes a favorable review. Because his review is disseminated via a form of consumer-generated media in which his relationship to the advertiser is not inherently obvious, readers are unlikely to know that he has received the video game system free of charge in exchange for his review of the product, and given the value of the video game system, this fact likely would materially affect the credibility they attach to his endorsement. Accordingly, the blogger should clearly and conspicuously disclose that he received the gaming system free of charge.
I am going to write more shortly on these rules. We believe that ever more than before, Expo continues to act as the clearinghouse for the best way for consumers to engage in authentic, helpful and relevant product dialogue.
Amazon killed its Video Widget this morning. Sunsetting fully-working affiliate tools simply due to low usage cannot be a high priority for Amazon at this flush time. I would guess that it was closed down due to reasons other than low participant uptake. Sometimes, low-level tools are shut down because the number of complaints aren’t worth the fixes. When I wrote about the Video Widget in the Spring, a concern was the conflict between uploading a ‘review’ video and then making affiliate fees off it. It would have been possible to trash competitive products to promote your own. Alternatively, possibly people were taking advantage of a free hosting platform and uploading personal videos. Since you have to associate one product to each video, perhaps manufacturers objected to having their products associated with unscreened, irrelevant videos. Here’s one by me:
Another reason to sunset a working product would be if an improved, or conflicting product is due for launch. This might be the case since they’re allowing you to leave up your old Video Widgets. If I find other discussions about the closure, I’ll update this post.
The position that social media marketing is risky for brands is far from unfounded. The democratization of any medium is almost by definition messy and uncontrolled. That is a scary place for brands to be. But the smart brands know that it’s scarier to not be there at all.
We have been working with a number of those smart brands.We use three ingredients to ensure that everyone wins…our clients, our creators, and our consumers.
Start with a great product
We don’t work withF500 brands because they’re the easiest ones to get to. For a small company, they’re the hardest to get to. But we target working with F500 brands because they launch great products. They do a tremendous amount of work beforehand to ensure the success of a product. P&G spends $2 billion a year on 8,000 engineers. LG maintains 30research centers for $3 billion a year. Who wouldn’t want to test a product that has millions of dollars of R&D and months of consumer testing behind it? Expo has actually turned down a number of companies because we thought that the products were not high enough quality.
Don’t ask the bald guy about shampoo
Part of the power of social media marketing is that it is intensely personal. Sites should know so much more about their community than ever before. Companies that allow anonymous text postings, or encourage thin veils of member credentials are simply socially bankrupt. The more information your community shares with you about itself, the more you can tap into the appropriate, relevant social network for clients. A great product needs to be in the hands of the person it was designed for. Great brands design their products with a very in-depth consumer profile in mind. These profiles don’t just encompass age, gender, income, but also include things like buying habits, social activities, lifestyle choices, and family size. We have located, on behalf of our clients, consumers with a certain hair length, buyers of no-frills grocery products, people who watch a specific TV show, even women who are breastfeeding!
Reward an honest relationship
You started with a great product. You put it in the hands of the target consumer. What can go wrong? At this point, very little should go wrong. But, alas, companies out there have screwed it up anyway. A few thoughts on how to avoid the last few potholes on the way to buzz nirvana…
There should be no need to bias the consumer. If you feel a need to somehow inject incentive for positive reviews at this point, then something in step 1 and 2 isn’t working.
General review sites on retailers and elsewhere generate about 80% positive buzz. We will turn down clients expecting us to generate a 100% positive campaign. Trying to manipulate an unnatural result leads to disastrous choices.
Disclose until you can’t disclose anymore. Don’t just do this for FTC reasons…which are only there to protect the reader/viewer of the content. Disclose and require disclosure so the community of contributors knows that those are the rules you play by. Build a relationship with contributors where everything is out on the table. You will attract people who want to play by those rules. Those are the people that will strengthen your ability to guarantee a natural, authentic and honest result.
I see Google’s new filter, Search Options, as a very specific attempt by Google to own consumer word of mouth — that untethered sea of millions of voices speaking about products, experiences, brands. The Search Options that Google launched: Video, Forums, Review…are all currently the strongest forms of consumer expression. In evidence of their interest in commerce, the example in theirvideo demonstration of Google Search Options is a product search: “Powershot SD 750”.Based on the selection of filters available in “Show Options”, Google isobviously hoping to capture a larger share of product researchers by optimizing their search results. Let’s break down the first few critical Search Options that Google chose to launch.
Video: Well, there’s expotv.com, the largest and only video site dedicated to word of mouth video for consumers. Great content to surface in Search Options! And then there’s youtube, which could be characterized as the largest video platform dedicated to word of mouth video for anything. Unfortunately for users, youtube’s page rank of 9 will render this Search Option less helpful. Youtube’s product-tagged video will surface often, but the results will have a number of weaknesses for consumers looking for helpful product information. The two that we often point out are:
(i)the horrifically uneven quality, type and quantity of information that is presented from video to video
(ii)the inability to search effectively no matter how specific your search terms due to poor tagging by great videos, and great tagging by poor videos
However, if you’re Google and you own Youtube, then helping youtube surface even potentially relevant consumer video is a great way to monetize the content.
Forums: Why search forums? Aren’t they the sources that you most avoid when doing a search? Sorting through a bunch of moms talking about swine flu is not going to give you much serious information about the disease. But if the search is on products – forums become an authentic source of consumer enthusiast information. Unlike on Web 1.0, corporate poseursare now often outed immediately on forums. Hard-core enthusiasts take legendary status on forums as moderators, contributors, and consumer experts. The information on the best and biggest forums offer sincere,personal and authentic discussion by enthusiasts. Go to a Disney boardif you want to know the best rooms on the Disney Cruise ship, not Disney.com.
Reviews: I assume I don’t have to cover how reviews are relevant if Google wants to own word of mouth consumer search. The proliferation of text reviews (and even the proliferation of tools that allow sites to implement text reviews) make Google’s search of the resulting vast expanse of content invaluable. Amazon does a great job of sorting through its user reviews in order to spur conversion to sale. Why shouldn’t Google apply that same logic to ALL user reviews.
From Expo’s point of view, Google’s optimization of consumer word of mouth is a boon for content sites like ours. Expo will benefit from the care and attention Google is putting to format, content, and source of user generated product information. We think product researchers will undoubtedly benefit as well.
What’s next for Google Commerce:
Google’s already reached perfection taking both irrelevant and relevant content and attaching a commerce component via Google Adsense. What’s left? Price comparison is dominated by the engines like shopping.com and now it’s commoditized with APIs. Product selection search is dominated by Amazon and its vast marketplace of products. Google then tried inter-Amazon search through its “site search box“. While a smart move by Google, it’s a terrible user experience since Amazon does a much better job of searching its own site and tailoring it for the non-anonymous user.
My bet is on Local Commerce. Local commerce is one area that has yet to unlocked by online tools. My bet is Google will win that game against the brilliant start-ups out there trying to attack local dollars. Local cannot be attacked on a national scale (thus the different names), but GPS is allowing hyper targeting to become relevant to geo-targeting. By vectoring GPS, maps, and local search, Google has the winning combination of national services to synthesize local advertising. Remember, they don’t need to create the local content, just find the right person to deliver it to.
Woefully behind on tricking out our Youtube page with new utilities. Today, Youtube SEM.
1) You can now set up a text ad much like an adsense ad, and then buy keywords for placement of a link to promote a specific youtube video or video channel. The example on the right shows how I purchased the word “consumer reviews” and you can see my bid earned me first placement among…one bidder. The layout is integrated, with a video thumbnail and my text descriptor.
2) Obviously, the key is finding the right keywords that work for you. There are similar tools to adsense that will suggest related keywords to the ones you are targeting. I assume those are based on popular youtube search queries.
3) Youtube allows you to set a maximum bid price and a daily maximum budget. The interface allows you to see the average slot placement you earned based on your bid. You can change each keyword individually. Youtube serves google adsense results when there is no youtube bidder. In my small tests, it seems if there is at least 1 youtube bidder on a word,
youtube seems to displace the adsense module for the youtube bidder. My bids were very high, so it’s possible the unit is already be optimized to serve adsense or the youtube bidder based on which yields the most revenue. However, for strategic reasons, I would think they would favor heavily the youtube bidder. Such a weighting keeps the visitor within youtube, since the paid link goes to a youtube video or channel. That allows youtube to show effectiveness of the ad unit, and the ability to keep the user to monetize further.
The Youtube Promoted Videos is an interesting ability to get distribution for your video. The trouble for youtube will be finding users who have the ability to monetize their video or channel, or have rationalized some other reason to pay for viewers. The rates are relatively high…I’d heard the average is $1.00 CPC, although we have been experiencing significantly lower CPC than that for first slot placement on our keywords. (Obviously, it all depends on what words you’re going for.) I’ll update that range as we expand our buys.
More on the impact of these changes to commercial applications after I post about the Youtube Insights module next.
Co-founder and CEO of Expo, video commerce solution based in New York City. Former CFO of Oxygen Media and member of founding team. Entrepreneur, wife, mom.
Unconstitutional. It’s such a cool word. As an American, it evokes the most powerful feeling of wrong. It doesn’t matter what it is, if it’s unconstitutional, you know it’s wrong.
The FTC guidelines for endorsements have been published and can be found 
