How Twitter Can Change Sports (& Other) Fandom

Hola Todos!

As part of my deep dive into Twitter this year, I’m always on the lookout for interesting “How To” or “What is” or “Insider Tips” articles that accurately describe Twitter.  The other day, one of my MBA students Jon O’Sheal sent me a good one that details how Twitter changed one fan’s means of getting sports info (click here for article).

Although these nine points are applied to sports in this article, one could easily substitute the sports exemplars for any other special topic of interest (e.g., politics, art, cars, social media, etc.,) to gleam a nugget or two.

 

Best regards,

Dr. Dan-o

 

Daniel M. Ladik, PhD

Associate Professor of Marketing

Stillman School of Business

Seton Hall University

 

 

 

 

 

 

 

 

Apps, Pinterest, Human as Brand, Apple CLV & Potpourri

Hola Todos!

I had a crazy/nutty/busy last week so I did not get a chance to read much – or as least read as much as I usually do.  Moreover, classes are in full swing so we a plethora of different conversation threads active among us.  I love to add fuel to the fire so here are some excellent new stories from the last week:

How to Create a $1M App with a $10K Marketing Budget

Super Bowl Advertising – Social TV Experience (e.g., Shazam, GetGlue, etc) in the Forefront

Google Knows Too Much About You

Human as Brand/Fan Identity w/The Phantom Menace

Human as Brand/Fan Identity w/Kathy Ireland

Pinterest – Why Image-Sharing Network Pinterest Is Hot

Pinterest – The Appending Affiliate Links to Some Pins

How Pinterest is Becoming the Next Big Thing in Social Media for Business

12 Most Effective Ways to Engage on Twitter

Apple, Customer Lifetime Value & Customer Churn

Enjoy!

Dr. Dan-0

 

Daniel M. Ladik, PhD

Associate Professor of Marketing

Stillman School of Business

Seton Hall University

 


Twitter is Trying to Create a Revenue-Generating Model

Hola Todos!

I learned a lot of nuggets in my Ph.D. program.  One of my mentors, professor Linda Price, often told us, “If you cannot explain your research to the cab driver in the car ride over to the conference, then your research idea is not clear, concise, or simple enough.”  My entrepreneurs out there know this concept as the “30 second elevator pitch.”  I talk about this concept in my class with the Key Word “Unique Selling Proposition” or USP.

To summarize, I feel Twitter has a problem because they cannot describe their revenue-generating model in 30 seconds or less.  Each year, I take a deep-dive into something (2011 was blogging) and 2012 will be micro-blogging (meaning Twitter).

Check this article out (click here) I read the other day. The first nugget I got was the concept of a “Chief Revenue Officer” or CRO.  That’s something new.  Second, we learned Twitter now has 2,400 advertisers, up from 1,600 in the spring.  Now that’s something clear and very easy to hang your hat on.  However, that is where the clarity ends.

The article goes on to describe (only briefly), Twitter’s main advertising platforms.

“Twitter offers three types of ads: promoted accounts, promoted trends and promoted tweets, which appear in users’ content streams. These types of ads draw “massive engagement,” Bain said, with a conversion rate of about 3% to 5%. The rate for traditional display ads is around 0.5%.  “The [return on investment] for marketers is insane,” Bain said, citing a handful of successful campaigns.”

While promoted accounts, promoted trends and promoted tweets are somewhat concrete, “massive engagement” and “insane ROI” is not.  Remember when you were little and there was always that one kid on the playground who ALWAYS over exaggerated just to grab attention?  That’s what Mr. Bain sounds like to me in this article.

In addition, while it seems natural to compare Twitter’s conversion percentage to banner ads (this is comparing apples to oranges), a better comparison would be to compare Twitter campaigns to Twitter campaigns.  For instance, you can report an average conversion rate of about 3% to 5%, but if 1 of those campaigns had a conversion rate of 25% and the other 9 had a conversion rate of 0.50% (note to mathematicians out there: I am making the numbers up for illustrative purposes), can Twitter really claim they average a rate of 3% to 5%?

Now that Facebook has announced an IPO, the pressure will be on Twitter to do the same.  Three years ago, we could have had a similar conversation about Facebook but not anymore with 4 billion in revenue last year. (However, I cannot wait to read their S1 to find out what their cost structure looks like on that 4 billion in revenue.)

I suggested a few weeks back (Click – Yahoo should buy Twitter and then merge with AOL) that Twitter should accept an offer from a “big brother.” This would take all the short-term pressure off of Twitter to build a solid revenue-generating model as opposed to a forced or hodge-podge revenue-generating model.

Something to think about today…

Best regards,

Dr. Dan-o

 

 

 

Yahoo should buy Twitter (and then merge with AOL)

Hola Todos!

I’m going to be honest here.  I am getting tired of the “Who is going to purchase Yahoo?” talk.  It’s be an on and off again headline for too long (for instance, click here).  Its like Yahoo is waiting for a “White Knight” to save them from their strategic nadir.  Well, my crazy idea of the day is for Yahoo to save itself and to buy Twitter (e.g., give Twitter an offer they cannot refuse).

Two questions you might be asking yourself right now are HOW and WHY.  The HOW is the easier of the two and believe it or not, Yahoo can accomplish this maneuver without lifting a penny off of its balance sheet.

I was reading The Wall Street Journal the other day and what I learned that Yahoo owns a 40% stake in the Chinese e-commerce company Alibaba Group Holding Ltd (click here). Through something I know nothing about called a “cash-rich split-off,” Yahoo can sell its stake in Alibaba, recently valued by Yahoo at about $14 billion, and avoid paying taxes on the profit from a sale (e.g., a tax savings of about $5 billion).

Twitter could be persuaded to take an all cash offer (with benefits) given their current situation and what’s happening in the marketplace.  I do not care what Twitter’s “potential” evaluation could be, Twitter is not IPO ready, does not have a significant revenue generating model, and the stock market will NOT to be ripe for tech IPO for quarters to come.  Give Twitter $3 or $5 or even $8 billion in cash now because who knows if they will get it in the future.  Then, Twitter can concentrate of what it does best without worrying about developing a revenue-generating model that Wall Street will accept.

As for the WHY – first, Yahoo can use Twitter to increase page views of their sites.  Yahoo’s strength is display advertising.  Yahoo can only increase rates for display advertising if they gain more eyeballs.  Twitter can act as the highway to draw more eyeballs to Yahoo properties.  Done.  Second, Yahoo needs leadership.  Twitter has the executive talent to run Yahoo.  In addition, with Twitter’s brand, Yahoo will be able to attract and keep talent as opposed to losing everyone to Apple, Google and Facebook.

The final maneuver would be for Yahoo/Twitter to merge with AOL.  Like Yahoo, AOL strength is display advertising.  Yes, Twitter can also act as the highway to draw more eyeballs to AOL properties but more importantly, a Yahoo/AOL is a much stronger display advertising play for marketers then either Yahoo or AOL by itself.

The new entity – YAT Inc. or TAY Companies (you have fun with anagrams) – will be powerful enough to be a player, as opposed to an also ran, in today’s marketplace.

So what do you think about that?

Best

Dr. Dan-o