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Direct Line Blog

POM Wonderful fires back at FTC

May 24, 2012

Let the rumble begin! In the right corner we have the Federal Trade Commission (FTC). In the left corner we have beverages company POM Wonderful.

On Monday May 21 Chief Administrative Law Judge D. Michael Chappell upheld an FTC complaint filed in 2010 declaring POM Wonderful had violated federal law, according to an FTC release. The ruling stated POM Wonderful made “deceptive claims in some advertisements that POM Wonderful 100% pomegranate juice and POMx supplements would treat, prevent or reduce the risk of heart disease, prostate cancer and erectile dysfunction.”

The judge further barred POM Wonderful from making any claims about the benefits and efficacy of POM products “unless the claims are not misleading.”

In particular, the judge ruled the violations were serious because consumers were unable to evaluate whether the claims were true or supported by the clinical studies cited in the ads.

Today, POM Wonderful said the FTC's release announcing the ruling was deceptive and oversimplified. The company also fired back by launching a new advertising campaign, POM Truth,

“The FTC critically failed to mention that out of the 600 print and outdoor advertisements disseminated, the court found less than 2% of those misleading,” according to a POM Wonderful release.

The campaign features a microsite where POM Wonderful invites consumers to “be the judge” by reading a POM Wonderful release, downloading the judge's entire initial decision and viewing 14 different ads featuring statements directly from the ruling.

The ads will be featured in full-page advertisements in newspapers such as the New York Times, the Los Angeles Times, online, home-page takeovers of CNN, the Huffington Post.  They feature points such as POM Wonderful's $25-million medical research spend, its antioxidant benefits and statements directly from the FTC ruling that were not included in the FTC's release.

It seems it is the FTC's turn to make a move. How will the FTC respond? Is POM Wonderful violating the ruling by launching the new advertising campaign?    

I don't know, but it seems to be getting intense and I will be keeping an eye on this fight.

 

Facebook IPO no

May 23, 2012

First, I need to get the silly headlines out of the way, or I won't be able to concentrate.

  • Time to face the music
  • Status: fiasco
  • Who needs friends when you have bankers?
  • The honeymoon's over (By the way, hearty congratulations to Mark Zuckerberg on his recent marriage.)

So it seems like the value of Facebook's $16 billion initial public offering may've been a little overblown. In the few days after the social networking site to end all social networking sites went public on May 18 with a share price of $38.23, stocks have tumbled dramatically, ending at $31 per share at close of trade Tuesday. And in that same time span, CBS News reports that Facebook's worth went from $104 billion to just shy of $67 billion.

Add to that the fact of possible insider trading-esque funny business on the part of Morgan Stanley, the investment bank that served as Facebook's lead underwriter during the IPO process and you have, in the words of former SEC chairman Arthur Levitt a "dreadful” situation for the markets in which “nobody looks good.”

And oh yes, Facebook is being sued by its shareholders for the way Morgan Stanley marketed the IPO process pre-offering. Even Zuckerberg's a defendant in that.

There's a definite sense of Schadenfreude out there. Comedian Andy Borowitz, for example, poked fun at the hoodie king with a mock letter from Zuck to potential investors, in which he points out how very different Facebook's monster IPO is (as in not at all) from the early 2000's dot-com bubble: “For one thing, those bad dot-com stocks were all speculation and hype, and weren't based on real businesses. Facebook, on the other hand, is based on a solid foundation of angry birds and imaginary sheep.”

The upshot: If Facebook wants to help save itself, it needs to clean the yolk off its face (please forgive me, I can't help myself) and start courting businesses and marketers even more aggressively. As David Berkowitz, 360i's VP of emerging media put it to Direct Marketing News last week: “That's where the money is coming from.”

 

Allison Schiff
is web editor at
Direct Marketing News.


 

All bark, no bite

May 22, 2012

Last night I received a direct mail piece promising discounts off my first purchase at Wag.com, a website that delivers pet supplies.

But there's a problem: I don't have a pet.

I do, however, adore make-up and skincare products, so a circular from Beauty Bar, Wag's partner site, would have been a truly enticing mailer to receive. I'm also on a kitchen appliance kick (I just got my first big-girl apartment), so Casa.com would have been great, too. In fact, I probably would have spent my lunch break perusing the sites for loot, expecting to make my big buy tonight. I assume Wag sent me its mailer in the first place because I'm a regular customer on Soap.com, a site that, like Beauty Bar, shares the same parent company: Quidsi Solutions LLC.

So, I'm curious: How does Quidsi decide who to send which promotional mailer? Are there mailers for other Soap-esque sites? I wonder. Because Wag wasted some postage on me.

This is certainly nothing out of the ordinary in the direct marketing world. Ads are mis-targeted all the time. I attended a conference where an audience member wanted to know why Pandora kept popping up dating ads — his wife was starting to get suspicious. And we've all had our share of Facebook ads that seem to make little sense. Mine, for example, have included lots of gardening lately. I live in a high-rise apartment building.

Although, Wag, I admit it: I really do want a puppy. I melt and fawn over them — perhaps too much. So maybe Wag is clairvoyant, knowing what I want, before I can have it. Maybe it's found the Holy Grail. But, more likely, this is just faulty targeting.

That said, a note to friends who may be reading this: Add a Welsh Corgi to my birthday list, please.

I've got a coupon to use.

Erin Dostal is a staff reporter at Direct Marketing News.
 

How will Google's Knowledge Graph affect SEM?

May 17, 2012

Google launched on May 16 its Knowledge Graph, which allows users to search for things, people and places that “Google knows about” and “instantly get information that is relevant to your query,” according to a blog post by Amit Singhal, SVP of engineering at Google.

The project began in 2010 when Google acquired Metaweb Technologies, a Google spokesperson said, which was working on the Freebase Project, described as “an entity graph of people places and things, created by a community that loves open data” on the website.  

Knowledge Graph, according to Singhal's blog entry, enhances Google Search in three ways: it makes searches more relevant, gives users better summaries of searches and helps users discover new things based on what others are searching.

The Knowledge Graph shows up on the right hand side, but only for particular items that are in the Knowledge Graph, which have been collectively pulled together from Google Search users. The Knowledge Graph has begun to gradually roll out to US English users. When it pops up is similar to how Google Maps pops up sometimes if your search is related to a particular address.  

The Google spokesperson said the Knowledge Graph does not have any particular effect on search marketing and display ads will still be shown when they are relevant.

On first glance, it seems as if advertisers may be missing out on the opportunity to show relevant ads to consumers based on searches. The amount of space Knowledge Graph takes up on the right side of a page—at least based on the blog post's images—looks like prime advertising space. However, perhaps—as MediaWhiz's general manager of search Adam Riff points out, this is a great way for advertisers to only display ads to relevant consumers and really zero in on exactly the type of people they're trying to target. Ultimately, brands won't have to pay for ads that aren't.

Even though Google indicated Knowledge Graph would affect search marketing, the company spokesperson gave an example that underscores Riff's point. For instance, if you search for the word “king,” you might get the sports team (either basketball or hockey), a television show, or a historical figure. But Burger King ads won't appear. Better targeting will create better value for display ads.




JoAnn DeLuna is the digital reporter at
Direct Marketing News.

 

SuiteWorld 2012 keynote: NetSuite to enhance software, e-commerce, CRM platforms

May 16, 2012

During his May 16 keynote address at SuiteWorld 2012 in San Francisco, NetSuite founder and CTO Evan Goldberg laid out several software improvements to NetSuite's cloud, including enhanced e-commerce capabilities and “revenue as a service,” a system intended to help software companies sell online.

NetSuite continues to build its cloud services for software companies, Goldberg said. “We are entering into the subscription economy,” he said. To this end, NetSuite plans to roll out NetSuite Recurring Billing, which is intended to integrate CRM, ERP and e-commerce platforms for software companies that sell their services on a subscription basis.

“There's a real tight integration of these parts,” of a business, Goldberg said. “It's simple power. It's easy to use, but yet it has very flexible billing plans. It's completely customizable.” Software companies that currently use NetSuite include Yammer, Square and Splunk, he said.

In addition, Goldberg said, NetSuite will continue to fill out its e-commerce offerings. Yesterday, Zach Nelson, NetSuite's CEO, announced SuiteCommerce, which is designed to help companies connect CRM and ERP to e-commerce, too. NetSuite currently works with 2,800 e-commerce clients, Goldberg said.

In the future, Goldberg said, NetSuite plans to further integrate its CRM and e-commerce platforms by building software that can track abandoned online shopping carts, pageless navigation (meaning that the company's name always stays at the top of the screen, regardless of browsing), and information about how to up-sell the customer (minimums for free shipping, suggested items, etc.)

 

GM gives Zuck a slap in the Facebook

May 16, 2012

The Wall Street Journal broke the story at 2:52 pm on Tuesday, May 15 with a tweet: “GM to stop buying ads on Facebook, sees them as ineffective.” Dare I say, the tweet heard round the world. It was actually only a rumor at that point (General Motors didn't confirm until several hours later), but the news caught fire immediately, as of course it would.

GM — the third biggest advertiser in the U.S., behind P&G and AT&T  — isn't going to stop marketing on Facebook. It's just going to stop paying Facebook for the privilege of doing so. The automaker still plans to maintain its page, where it has more than 378,000 “likes.” That, of course, is free. Well, free for regular people, not marketing behemoths. According to the Journal, GM expends about $30 million a year on agencies to develop its Facebook content and on staff to maintain the page.

Joel Ewanick, GM's head of marketing, proffered this rather bland statement to the press regarding the company's decision: GM is “definitely reassessing our advertising on Facebook, although content is effective and important.”

What GM spent on Facebook ads — just $10 million — was only a tiny fraction of its total marketing budget. Considering Kantar Media estimates the company dropped $1.8 billion on advertising in 2011, that's about as noticeable as a fly on an elephant's rear.

What this means for Facebook's long-awaited, highly anticipated, much-discussed and extensively pondered upcoming IPO is on the mind of every blogger, analyst, journalist, marketer and investor from here to, say, China — the only country in the world other than India whose population is still higher than the number of Facebook users: over 900 million.

However a marketer feels about the usefulness of Facebook ads, it's unwise to ignore a website that has more active users than almost triple the population of the United States. But Facebook doesn't hold all the power. If other large advertisers decide to chuck FB ads, Facebook could be cooked, as the Friending Facebook blog on ZDNet rightly points out.

How often do Facebook users really click on those ads in the right-hand column? One of my coworkers told me she was able to track down a service she was looking for through a Facebook ad, so for her it worked like a charm. But 57% of users polled by AP/CNBC in a recent survey said they never click on paid ads or sponsored content when they're on Facebook. [CNBC posted the results of the poll on Facebook. Both meta and cheeky.]

For a company like Facebook — the Journal says the majority of Facebook's $3.7 billion annual revenue comes from sales — that is certainly unpleasant news.

As for me, the effectiveness of Facebook ads is zero. I've never clicked on a single one.

 
Allison Schiff
is web editor at
Direct Marketing News.

(Zuckerberg image credit: zipmeme.com/)

 

The customer is king

May 15, 2012

One mantra throughout much of the SuiteWorld 2012 conference in San Francisco — its e-commerce track at least — is the vital importance of user experience. If a user doesn't like your e-commerce site, they're not likely to buy. It's that simple.

This morning, NetSuite announced SuiteCommerce, an e-commerce platform that is usable for both b-to-b and b-to-c companies.

Then, during one afternoon session, Eric Johnson, a vertical markets expert for e-commerce at Netsuite, said that something as simple as how quickly a site loads greatly impacts whether a customer wants to buy something from it. Citing a Forrester study, Johnson said that 47% of customers expect a site to load in fewer than 2 seconds, while 40% of online users will abandon a site if it takes more than 3 seconds to load. Johnson said that through SuiteCommerce, retail e-commerce sites should take about half of a second to load. And that, he claims, is pretty darn quick.

During the morning keynote, it was noted that shoppers prefer guided navigation over keyword searches. Why? Because guided navigation, which includes selecting sizes and colors of items during discovery, for example, gives customers a way of finding what they think they already want, while still giving them (hopefully) lots of options. From there, it's possible to up-sell them, and to market to them based on their purchasing history.

Since starting work as the e-commerce reporter at Direct Marketing News, I've found my beat to be a particularly compelling topic. Online shopping is something all of us have experience with on a personal level, so it's interesting to hear the stats. Three seconds? I sure hope that my attention span online is longer than that! But, when I reflect, there are many of my abandoned shopping carts littered throughout the Web.

User experience really is key, and NetSuite claims that SuiteCommerce will put this topic front and center. Although time will tell how successful the platform is in terms of connecting CRM with e-commerce sites, it certainly seems a worthy investment.

Marketers, tip your developers and designers. They may be driving e-commerce even more than you think.

 

New Facebook App Center highlights importance of mobile

May 10, 2012

Facebook has announced its new App Center, a central place for users to find social apps on the site, according to a post on Facebook's blog by Aaron Brady, an FB software engineer. The App Center will go live in the coming weeks, but developers can begin submitting both free and paid apps for consideration.

“The App Center gives developers an additional way to grow their apps and creates opportunities for more types of apps to be successful,” the post stated.

While any developer can submit an app to be considered —a s long as it follows Facebook's app guidelines and meets the quality criteria — not every app will be featured in the App Center.

Some of the guidelines include having a Facebook login, building the mobile app or mobile website for iOS and Android, and having an easy-to-use interface, high ratings and a low negative feedback rate.  

If the app is initially rejected, Facebook will provide suggestions for changes and developers can resubmit their app for consideration.

“Well-designed apps that people enjoy will be prominently displayed. Apps that receive poor user ratings or don't meet the quality guidelines won't be listed,” the post stated. 

Until now, users could only discover apps through search, bookmarks and social channels like requests, feeds and timelines. While these forms of discovery will still be available, the creation of a center makes it easier for users to find apps.

It also means brands have the opportunity to more easily promote apps, lead consumers back to their sites and keep them engaged — if they can meet the high-quality criteria. The fact that Facebook is being selective about which apps actually make it to the center will give companies bragging rights — a battle of the fittest.

It also emphasizes the increasing importance of having mobile-optimized sites. Marketers not only need to create apps, they need to create good apps and good content.

Requiring developers to include a Facebook login also increases Facebook's mobile presence, which if you read Facebook's recent SEC filing, is one of Facebook's weaknesses. In the filing Facebook states that its “ability to monetize is unproven.”

If Facebook requires app developers to build in a Facebook log-in, then the company becomes more valuable as more users log in.

 

Creative Week: Bringing un-sexy back

May 09, 2012

The five high-level creatives on stage at the Galapagos Art Space located on the waterfront beneath the Brooklyn Bridge in Dumbo at Creative Week's “Brooklyn's Finest Creative Roundtable” on Wednesday morning were cool. Not much else to say. These are some seriously cool people. HUGE partner and global creative director Joe Stewart has sleeve tattoos and Jonathan Hills of Domani was wearing colorful stripey socks. Laid back and smart.

But being “cool” is not the point, at least not exclusively.

For example, David Schwartz, creative partner at HUSH, was at a meeting with client Estée Lauder last week listening to a presentation on skin cells. “It's not something I would go home and read about,” said Schwartz — but it's a creative's job to be inquisitive and interested and “get into” what he or she is doing, subject matter aside.

“Latch onto something that gives you pleasure and mine that,” Schwartz said.

Big Spaceship founder Mike Lebowitz riffed on the point. “We're supposed to be able to see through the branding, but there was a point when for some reason I was still really attached to doing cool stuff and stuff I was interested in,” he said. “But then I woke up and realized that … what it's really about is doing something that challenges you intellectually.”

Creatives “are makers and makers want to make things and tinker and that's what's really exciting,” Lebowitz said.

Basically, un-sexy is the new sexy and there's no such thing as a “bad project.” So says Stewart of HUGE.

“Sometimes there are jerky clients, but that's a different thing — no project is uncool and your job as a creative person is to make whatever you're working on cool,” said Stewart, referencing a recent project his agency worked on for a client looking to talk to students about paying back debt. How uncool can  you get, right? Wrong, said Stewart. “Your job is to turn anything into something interesting,” he said. 

What is irrefutably cool, though, is Dumbo itself, which, like many other neighborhoods in New York over the years, experienced a revivification that's transformed it into a creative hub. As moderator Paul Woolmington, founding partner of Naked Communications pointed out, Harlem had its Jazz Age; in the 1940s Orson Welles stalked the streets around Broadway; the Beat Generation did its thing in Greenwich Village — and now there's Dumbo.

Throw a stone from the Galapagos Art Space and you're probably going to break an agency's window.

“But these creatives have been here for a decade or more,” Woolmington said, gesturing at the panelists on stage. “They didn't just happen upon this space when it became trendy.” This is especially true for Hills, whose agency Domani now does work for The Westin Group, Inc., New Line Cinema, Victoria's Secret, Gucci and others. But when Domani first opened its doors, Hills and his cohorts had to bring their own toilet paper to work in the morning.

It's that kind of catch-as-catch-can laidback attitude that appeals.

For example, take the location-based Instaprint photo booths dreamed up by Breakfast, a self-described “tiny magical shop” that devises bespoke and real-world products and installations. After Instagram released its API in February 2011, Breakfast cofounder and creative director Andrew Zolty and his team had a collective brainwave. If Instagram was inspired by Polaroid, then why not take that full-circle? An Instaprint box, as its name denotes, will instantly print any Instagram photo tagged with a specific location or hashtag. The product debuted at SXSW two years ago and the response has been enormous.

“But the first Instaprints were made out of boxes we got from [furniture store] West Elm around the corner,” Zolty said.

Last week at Big Spaceship's very first “hack day,” employees were broken down into groups and tasked with creating a working prototype within 24-hours. Of the eight solid ideas that came out of the day — “I had pretty high expectation and they far surpassed them,” Lebowitz said — three will actually be going into production.

One such product is called “Tracksy,” a tool that can produce instant cost benefit analyses using real-time subway and taxi data, including traffic patterns and train delays, to help harried New Yorkers on-the-go decide whether it's more economical and/or beneficial time-wise to take a taxi or the MTA. Lebowitz asked the audience members what they thought about that idea and there was applause all around. I think I even heard a “whoop.”

Yes, we live in a work-a-day world, but that doesn't mean creativity has to fall by the wayside.

“Even though we have to produce our livelihoods through graft, we can still be innovators.” Well said, Lebowitz.

Check out caples.org for some excellent examples of recent creative work and click here for more Creative Week coverage.



Allison Schiff is web editor at
Direct Marketing News.

 

LoyalTea works on me

May 08, 2012

As a woman in my mid-20s, I'm a member of a ton of loyalty programs. Airlines, restaurants, grocery stores, retail shops, hotels — you name it. It's just a part of the spending culture for people in my age group.

My most recent acquisition was Argo Tea, a love of mine since I was in college. It's called the "LoyalTea Club." Cute, right?

Although I have yet to actually redeem any of my rewards (I certainly plan to), it's a program that has me more excited than others have in the past, and here's why: The rewards are clear and I know exactly how to earn and use them.

Every 11th drink is free. Food is 10% off when I buy it with a drink. And I get double points if I go before 9 a.m. — proof to me that Argo Tea is viewed less like Starbucks and more as a luxury item, but I digress. The free drink on my birthday made it worth joining, even if it meant signing up for their email list. The rewards are easy to remember and explain and I could easily rattle them off to a friend in an elevator — and I have. Check it out. It doesn't get much simpler than this.

LoyalTea does exactly what a loyalty program is supposed to do. It makes me feel rewarded without making me feel taken advantage of. And because it's right by our Direct Marketing News offices, I fully expect to actually reap the benefits I'll surely earn.

Yes, stores with small-time purchases like coffee and tea shops have more flexibility to do this than, say, an airline or hotel company. But the lesson is the same. If your company's rewards aren't clear, you won't get what you want from your best customers, your loyal loyalty members.

Now, I'm craving a green passion fruit bubble tea. Yum.

See? LoyalTea works. It's that simple.

 
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