Good-bye AOL

AOL is shutting down. This should really tell us something.

Ten years ago they were one of the world’s biggest internet service providers. Remeber the numerous free installation CDs they distributed like crazy? Some of them even built ash trays out of them. But that’s another story. At some point they also purchased CompuServe, remember that one too?

AOL sold their dial-up business and kept what was then very profitable for them: online advertising. They owned high-volume sites such as their own aol.com, simply because they made it the default site for their customers.

Ten years later things have changed. Advertisers aren’t willing and able to pay outrageous CPM rates anymore. That paired with some serious miscalculations internally led to a huge operational loss in the company. Their display advertising business wasn’t working anymore.

AOL is downsizing, getting rid of many advertising sales organizations. This includes Advertising.com aka Platform A in Germany, Europe’s largest display market. They’re looking for other companies to take over their business now and are in talks with the unions about layoffs.

So what do we learn from this? Well, in online media you can’t survive with a ten-year old business model. The market value of any asset slowly but surely disappears. Once you’ve reached the stage where you’re really comfortable you need to continue developing new stuff. Otherwise you fall behind because there are more smart people out there than you think.

Affiliate Summit West 2010

Just a quick note: I’m going to be at Affiliate Summit West in Las Vegas from January 17 to 19. My company will have a table at the Meet Market on Sunday. You can catch me at table no. 27. I’m going to be around on the other two days as well. If you want to meet up just get in touch via email or Twitter. Hope to see you soon.

No more Windows

The last day of 2009 will also be the last day of me using Microsoft Windows. This is a quick farewell to an operating system I’ve been using for 19 years. Over time it became worse and worse. Today I would describe Windows as vulnerable, slow and over-engineered. And no, Windows 7 doesn’t do it for me either.

For about a year the only reason for me to use Windows is iTunes and iPod/iPhone. Most of my other tasks could get done easily by a Mac or a free Linux distribution. Tomorrow I’m going to bury Windows and use the free disk space for my existing Ubuntu installation. For development and office work I’m switching over to Ubuntu, multimedia and iPhone stuff will be done on a Mac.

How Not To Translate Landing Pages

I’ve recently come across a weight-loss offer on AzoogleAds. Colon Cleanse is one of these rebilling offers which pays over 30 dollars per sign-up. The product itself is probably absolute bogus.

The landing page has geo-targeting built in. And when you access it from a German IP address it takes you to a horribly translated version on gut-free.com. If you’re a German speaker, sit back and have a good laugh:

NOKIA Night of the Proms 2009

I’ve just returned from the NOKIA Night of the Proms at the O2 World in Berlin. I’m still impressed so I thought of writing a few words about the show.

It’s an almost four-hour concert/show with a mixture of classical music and a number of pop/rock acts. They used to be famous 20-30 years ago and are obviously less expensive these days. So it’s actually possible to get them perform in one tour. Almost all songs are accompanied by a full symphonic orchestra and a choir.

In my opinion the most outstanding musician was John Miles. He started out with an amazing interpretation of Led Zeppelin’s “Stairway To Heaven” where he accompanied himself on the piano and threw in a killer guitar solo.

The range of John’s voice is incredible even though he turned 60 this year. When he performed a jazz tune it sounded as if Frank Sinatra was singing. He hit every single note, not a single mistake. This is truly one of the world’s top musicians. He finished his part with his “Music” (was my first love …).

The other highlight was Roxette, the Swedish pop duo of Marie Fredriksson and Per Gessle that was big in the 80s and 90s. They were big in Europe and became famous in the U.S. with the Pretty Woman soundtrack (with Richard Gere faking on the piano in the music video).

In 2002 Marie was diagnosed with a brain tumor, got treatment and is probably still taking strong medication. She still doesn’t look alright, can’t walk much and couldn’t jump up and down the stage as she used to ten years ago. Her voice is still unique and sounds like her. But it’s lost a lot of range and she had problems hitting the high pitches. However, Per still rocks the house and made up for Marie’s limitations.

Thank you for putting this show together. This was the second time I went. I will certainly come back next year.

The End of Tracking Cookies in Europe?

The Council of the European Union has approved a law ending the current use of tracking cookies in the EU within 18 months. The EU directive will now be turned into national laws. In detail, the new regulation will require that a cookie can be stored on or accessed from a user’s computer only if that user “has given his or her consent, having been provided with clear and comprehensive information.”

There is only one exception to the rule: Permission to store or read cookies is not mandatory when their use is “strictly necessary” for the provision of an “explicitely requested” service. That means, if a user is clicking through an online shop and puts items in the virtual shopping basked, the site may use cookies. However, the site may not read or write cookies for the purpose of third-party advertising as users don’t explicitely ask for the display of advertising. In theory that means that any site serving ads will need to ask for users’ consent.

Full version here: DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Directive 2002/22/EC on universal service and users’ rights relating to electronic communications networks and services, Directive 2002/58/EC concerning the processing of personal data and the protection of privacy in the electronic communications sector and Regulation (EC) No 2006/2004 on cooperation between national authorities responsible for the enforcement of consumer protection laws

If the laws will actually be enforced it will mean the end for a lot of business. Many sites out there derive their revenues from consent-less advertising only. This also includes Facebook, YouTube and so on. As most ad servers out there are completely based on cookies, these companies would have to ask their users for permission to show them “well-chosen offers of partners”. This would also give users the option to choose an ad-free YouTube or Facebook. Who is going to be paying for the service then? Will casual communities introduce subscription fees just like LinkedIn?

The consent requirement for the use of browser cookies also applies to analytics. All sites using Google Analytics, Omniture etc. will need to ask for explicit permission to store and read cookies too. This however isn’t all that bad. No matter which website I visit, I always see Google Analytics requests in the status bar of the browser. They can track a user across the whole internet which is quite scary actually. At this time nobody is asking for my permission.

I’m not sure if the directive will really become effective national laws. There is too much money in online advertising and I think a lot of companies will begin some heavy lobbying soon. The new regulation would kill some of the greatest innovators out there. The other question is how the authorities will actually be enforcing the laws. Anyhow, cookie-less tracking techniques will become more and more important.

AdMob Acquired By Google

Just heard the breaking news of Google buying AdMob, the biggest mobile ad network, for 750 million U.S. dollars. This should seriously mean something to those out there still questioning the growing importance of the mobile internet and mobile advertising.

What would Google do? What did Google do? Go mobile.

“That sale is mine” or The Need To Abolish the Last-Cookie-Counts Principle

As online marketers we often preach that online and mobile are so much better than traditional/offline marketing because we can track everything and measure all marketing activities correctly. The truth is that most companies base their decisions on invalid data about their online activities. Some of them are aware of it, most of them are not.

Back in the dark ages of online marketing it was alright to associate an online transaction with the last traffic source previous to that purchase. Having some data was better than having nothing. But customer behavior and online marketing techniques have evolved. Also, online marketing budgets are significantly higher these days, so we need to be a lot more acurate now. All this lets the principle of “last cookie wins” look antiquated.

Here are some facts I picked up at the latest a4uexpo affiliate marketing conference in London. During the “Affiliate Apocalypse Panel” Julia Stent of Vodafone UK shared some insightful data with us:

• In general there is a 20% overlap between affiliate and paid search traffic.
• In only 21% of all affiliate sales, the affiliate is the only person involved in generating that sale.
• For 72% of online sales in the travel industry where a user has visited an affiliate site at some point, affiliates were not rewarded due to the last-cookie-principle.

Currently we attribute a transaction (lead or sale) to one traffic source only. But given the previous facts, that actually ignores valuable data and leads us to miss the bigger picture completely. All marketing activities are inter-related. That goes for offline vs. online and also for within the online sphere.

However, today’s world, especially in online marketing, is still driven by the old principle of “that sale is mine.” In numerous companies I’ve seen internal fights about this, display vs. search vs. affiliate managers. Instead of cooperating they often work against each other, accusing each other of stealing sales. It’s usually the affiliate marketing people that have to defend their affiliates and themselves.

“That sale is mine” can no longer be our mindset. Instead we need to find ways to distribute commissions among all parties involved in the decision-making and buying process in a fair manner. We need to measure the true influence of an advertising channel and the parties involved instead of relying on the last-cookie-counts principle.

This would also remove the issue of chasing the last click, something that affiliates have become extremely good at through coupon sites or cookie spamming in the form of layer ads, pop-up windows, adware and other forms of forced clicks.

What we need is cross-channel tracking on the side of merchants and affiliate networks turning more into technical solution providers. We need to be able to split commissions for the same transaction among several traffic sources. Something we probably won’t see anytime soon, but this is where it needs to go.

Postview Panel Discussion at Affiliate NetworkxX

I’ll be part of a panel discussion on the good and evil sides of post-view tracking in affiliate marketing at the Affiliate NetworkxX in Munich on tomorrow evening. More details on the organizer’s blog. Here is a summary of the points that I’ll be trying to make there:

1. visibility of creatives

The current technical set-up for post-view tracking doesn’t ensure that cookies are set only if a banner is actually seen by a user. I don’t think it’s fair to give an affiliate credit for a post-view sale triggered by a banner that was placed at the very bottom of the screen. Most likely this banner didn’t have anything to do with the sale. A multitude of banners below the fold of  the screen is simply cookie spamming.

2. cookie switches

Merchants working with more than one affiliate network or tracking tool must expand their cookie switch from clicks to impressions. Otherwise the same post-view transaction will be tracked by more than one network.

This essentially means that merchants need to have their own post-view tracking running. For most companies that’s quite unrealistic though because they either don’t have the skills to make it happen or don’t want to bear the extra cost of counting every single banner impression.

3. lack of transparency

Currently there is no transparency in the use of post-view tracking. There are networks that simply turned for it on for certain programs without approval by the merchants. About a year ago most networks proclaimed to kick cookie-spamming affiliates out of their networks. Now they seem to re-introduce cookie spamming again through the back door by the use of post-view tracking.

4. lack scientific proof

I am not aware of any independent study proving an increase of profits for merchants by the use of post-view tracking. Yes, of course more sales are being tracked, but in most cases they are just “stolen” elsewhere. There is a significant number of transactions that would have taken place with or without postview.

Mobile Expert Surgery at a4uexpo London 2009

If you happen to be around at the a4uexpo affiliate marketing conference in London next week, this one might be of interest for you:

On Tuesday between 2pm and 4pm you’ll have the opportunity to get some free one-to-one consulting on mobile marketing and mobile advertising. You will be able to find me in the expert surgery zone. Details can be found on the a4uexpo blog.