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Audi Gentleman's Racer - (by @baekdal)

Every now and then, you come across a design that just blows you away. Like the Audi Gentleman's racer concept made by Mikael Lugnegård. I just have to get one of those!

One might argue that Mikael has a rather-distorted sense of what a gentleman is. I think this is more like something coming out of Stark's Industries - or maybe Swedish gentlemen are a rowdy bunch?

Mikael has also created several other amazing concepts designs, including this bike.

The Digital Renting Business is Fundamentally Flawed - (by @baekdal)

Later today, Apple is having yet another one of their mystery press events, where they are expected to talk about iTunes. One very strong rumor is that they will extend iTunes into the online renting business, allowing US customers to rent TV shows at 99 cents.

I don't know whether that is true, but I do know this. The digital renting business model is fundamentally flawed, and we need to get rid of it before everyone forgets why we do not need it.

The renting business model makes a ton of sense in the traditional world of manfacuring and distribution. It's a win-win situation for everyone.

The content producers save a ton of money because they don't have to manufacture as many DVDs. There are costs savings on shipping, you don't need as big a warehouse, and most of all, you don't need as many employees handling everything.

The physical shops, like Blockbuster, save a lot of money on shelf space. They can increase their inventory. And, they get a much higher sale when renting a DVD for $2.99 than trying to get people to buy one for $10.99.

The consumer gets access to content they want for a drastically lowered price, with only a very small additional cost of being forced to return it 48 hours later.

Everybody wins!

The renting industry was simply invented to lower the cost and resource requirements of manufacturing, distribution, and storage - to lower the price to a level acceptable to the market. That was the problem they solved.

None of this makes sense in a digital market.

In a digital marketplace, the cost of manufacturing is zero. Once you have created your "prototype," you also have your product. A movie studio doesn't need to manufacture DVDs, because the original digital file can be used directly.

There is a very low cost of distribution, which amounts $0.43 USD/person if you decide to use Amazon S3 (cloud computing). And this amount includes storage costs as well. But that costs would still be $0.43 if the TV and movie studios where to sell a movie instead of renting it.

However, the technical requirements for renting content are enormous. You have to add some kind of DRM to prevent content to be played 48 hours later. It has to work even when you are not connected. You have to create databases that tracks each transaction etc. All which costs money to make?

So what exactly is the renting business model solving?

In the traditional world, the renting business saved costs, lowers the price, and thus increases the market demands.

The digital model does not save money. The cost of manufacturing, distribution and storage are the same as if a TV show were simply sold + you have a higher cost of development.

In the digital world, and from a financial point of view, selling a TV show would be more cost efficient than renting it.

What is really going on here?

Some of you might argue that the TV and movie studios will earn more money because people might rent the same episode twice. But that logic is flawed when you compare the user behavior with how you used to rent movies at your local Blockbuster.

How often have you rented the same movie more than once? Yeah... never!

The real answer is two things.

1: Traditional executives have forgotten why they started renting content in the first place. They are just continuing the status quo, doing what they have always done, and generally failing to understand the economics of the digital world.

2: The few executives who do get it, are trying to drive up a false level of demand, by implying that buying a TV show should be more expensive than renting it. They are being greedy, and are using every trick in the book to get you to play along.

The renting business model is a relic from our non-digital past, and back then it solved a real problem in a rather ingenious way. But, the internet has solved that very problem in a much more efficient way.

There is no longer a need for a renting business model, as the problem of manufacturing, distribution and storage no longer exists.

In the digital world, we now need to turn look at other business models, to better reflect the limitations of our digital future.

Like:

• Complexity drives up costs, so it's better to simply stick to the original. Solution: Buy direct access to the original, instead of renting.
• An abundance of choices drives up the time it takes to make a decision, which lowers the quantity of a potential sale. Solution: Subscribe to get access to the full library, instead of buy/rent individuals shows.

The digital renting business model does not solve any of these problems. Renting solved a traditional problem, one that no longer exists.

Let's get rid of the renting business model before people forget why it is that we do not need it.

Facebook Users vs. Population = 120% - (by @baekdal)

Earlier today I was reading Pev Research's report on "Older Adults and Social Media," and how that age group has doubled in size. It's a fascinating report.

It then struck me that it would be more interesting to compare the actual population numbers from US Census Bureau, with the latest social media usage numbers - for all age groups.

That's the really interesting number. We always see usage graphs listing the quantity of users, but most of them don't compare it to how many people who are actually alive within each age group.

What I didn't expect to find was that people lie a lot about their age. The numbers being reported by Facebook doesn't add up. According to them, more than 100% of the population, age 15-25, use Facebook. That's not actually possible.

Here are the graphs for USA and UK:

As you can see. In the US, 105% of the women age 15-25 use Facebook. In the UK it's even worse. Age 15-25, 111% of the men and 120% of the women use Facebook.

That's a lot.

But, there is an easy explanation. People lie about their age, especially of you are under 13 years old.

As you might know, you have to be at least 13 years old to sign up for Facebook. But we all know that a lot kids below that age use it too. They simply sign up telling Facebook that they are 17 or 20 years old.

This explains why the 15-25 age group is artificially inflated, and why there is such a significant drop when looking at the age groups below 15.

Note: Facebook is clearly aware of this behavior, as they are using it to defend themselves in a recent lawsuit.

While I believe this is the primary reason, the stats are also skewed by people having more than one account. I have 3 + 5 dummy accounts for clients (used for administration purposes). For each of these, the age is set to match the target market.

Note: A number of people also think this might be caused by old men telling girls they are 18, for unethical reason. But, while that is disgusting, I don't think they make up a significant number (but I have no data to support either claim).

We also have people telling the world that they are younger than what they really are. Like when a 34 year old person say she is only 24.

This clearly indicates just how inaccurate our social stats really are. It's not that Facebook is lying about the numbers; the problem is that people aren't being completely honest about their age.

I think the numbers above 35 are pretty accurate, but it gets complicated below that.

Keep in mind that there is an old saying in the world of marketing, it's not about how old people really are; it's about how old they feel.

The kids below 13 are clearly lying about their age to gain access, and that skews the numbers dramatically. But, if a person who is really 34 is indicating that she is only 24, you must threat her as a 24 your old person. That's how old she feels, and that is the only thing you need to know.

Real age is overrated. And apparently, so is social media statistics.

From Pencil to Print to Pencils - (by @baekdal)

Many journalists used to jot down their articles with a pencil, before it was converted into a printed newspaper. These days, the role of the pencil vs. newspaper has been reversed.

Treesmart is a US company, who specializes in turning old newspapers into beautiful pencils. Instead of "from pen to print" we now have "from print to pen."

Apart from the obvious recycling and ecological message, they produce an interesting effect when sharpened. Since this is real newspapers, a new pattern appears each time a pencil is sharpened.

It's fascinating.

What Facebook Places Really Means to You - (by @baekdal)

We are now a few days past the announcement of Facebook Places, and you can read about my initial reaction in "Does Facebook Places Change Anything?"

A much bigger question is what it mean to you? As a person, business, or as a developer? The short answer is; it will take time before any real meaning emerge.

For you as a person

Facebook Places changes very little to you as an individual. You can check into a place, but you have already been able to do that via Foursquare and Gowalla. If you are not already into location based services, chances are that Facebook won't change much.

It does mean that location based adoption rates will go up quite a bit. But, it doesn't mean that all Facebook 500 million users will suddenly check-in where ever they go.

Also remember it's iPhone only for now, which drastically limits the theoretical user base, though it is a popular device.

Facebook places is still too limited to be really useful for anything than telling people where you are, or have been. For most of us that aren't really that exciting.

Location based services only becomes really exciting when it can extend your feelings, experience, or your knowledge linked to a specific location.

Also read: The Future of Foursquare and Gowalla.

What is of some importance is the lack of privacy. Facebook has again completely missed the point of what privacy is all about. As I wrote in "The First Rule of Privacy," I am the only one who can decide what I want to share, not my friends, nor Facebook.

But despite that, Facebook has decided to allow your friends to share your location. They can share it with a place AND with 3rd party site/apps.

This is a serious privacy violation.

I don't mind my friends sharing my location if I have given them permission to do so, but I have to give them my permission first.

Especially because I, like so many others, don't want to tell people when I am away from my home for longer periods of time.

There are three settings you need to take control of. First go to: "Facebook Privacy Settings"

1. "Places I check in to" can be adjusted by clicking on "customize settings," but by default it is set so only your friends can see where *you* check in. That's OK.
2. But also under "customize," find the section "things others share," you will find "friends can check me into places." Curious enough it is set to "select one" by default. Set it to "disabled" to prevent people in your friends list to check you in without your permission.
3. Under "Applications and Settings" and "info accessible through your friends," are all the settings friends can share about you when they use 3rd party apps. Uncheck "places I check into" (and all the others).

The last setting is something that most people miss. To me it is the most damaging of all Facebook privacy violations. Why they even allow your friends to share your personal information with 3rd party apps is beyond me.

Also, notice that it is a rather-complicated operation to change all the privacy settings for Places. Instead of just putting them in a single place, Facebook seems to make it as complicated as possible (they call it "complete freedom to decide on everything")

Note: Facebook has created this "simple" video that explain all the settings.

For you as a business

While Facebook places isn't that important for individuals, it is of vital importance for your business if you operate in a physical location (web shops, service companies etc can ignore it).

If you have a number of physical stores, people will now be able to find and see what other people think about your shop - directly on the most popular channel on the planet.

Facebook is far more popular than magazines, local newspapers etc, so it is of vital importance that you "do something with this."

First thing, of course, is to claim a place. Actually, if I had a physical shop, I would make sure I was the one who created the place in the first place.

When you claim a page, you should merge it with your existing Facebook page. Update your opening hours, pictures, info etc.

One very critical issue is that there will be a place for each of your physical locations. If your company has 300 shops, then there will be 300 Facebook places - each has to be claimed individually.

More important (as far as I can tell), you cannot merge a single Facebook page with 300 places. So each shop will need a separate Facebook page for that specific shop.

This is a really drastic change. Right now, most retail brands focus their resources and energy on a single Facebook page for the brand as a whole. But with Facebook Places, you will suddenly find that you have 300 channels whether you like it or not.

It might sound bad, and it is definitely a drastic change, but keep in mind that this is already happening with Foursquare and Gowalla (most business just don't pay attention to it).

What we have here is actually an incredible opportunity. When it comes to Social ROI, the money doesn't start to flow until you create a direct connection between the engagement that you create and the actual sale.

If you sell products in physical stores, then having a Facebook page is still several steps away from where the sale is happening.

But, if you move your focus from a corporate all-in-one Facebook page, to 300 hyper-local and personal Facebook Page/places, get you store staff to connect and communicate directly, then you have a much higher likelihood of creating real ROI (instead of imaginary numbers that look good at meetings).

If you are smart, you get a good developer to create an automated connection between your local pages, and your main page. So your staff don't have to post things twice, and to better help people find a local shop/connection.

Think of your main Facebook page as your life stream and guide, and each local place/page as the point of your long term interaction.

For you as a developer

As a developer, Facebook Places is just another dataset that you can use to your advantage. We have already seen tons of interesting implementations of Facebook's current Graph API, this just makes it even more useful.

For app developers, this gives you a really big platform to extend your app from. Sure it might cause trouble for Foursquare and Gowalla, but if you want to do e.g. an app for finding art museums, then Facebook Places can provide most of the data, the connections, and the reactions.

Like the huge amount of small Twitter apps and experimentations, Facebook places will facilitate an incredible explosion in location enabled apps.

A few other issues:

• Facebook places is currently US only, no word yet when it will be expanded globally. My personal estimate is within a few months.
• You can currently only add a place from a supported device (iPhone for now). So if you are a business, and don't have an iPhone... GET ONE!
• Places is currently only designed to support physical places (like shops, parks, malls etc), not soft-locations like concerts, events, moving locations, or multiple locations combined into a single "location".
• iPhone only for now, but other phones coming (will probably take a lot longer to emerge). You can also use "http://touch.facebook.com"
• To claim a page you have to through a rather lengthy process, involving authorization via phone and proof of legal ownership. More in the Places FAQ.
• There are some rumors that not all types of places can be claimed. I don't know what that means.
• For developers, Facebook Places graph is currently read only. Only selected beta partners can write to a place.
• Like with Facebook community pages, Facebook places will be really messy the next 6 months. (yet another reason to claim your place early).
• All Facebook places are public (you cannot create a private place e.g. for VIP purposes).
  

We Can Save Newspapers by Destroying The Web - (by @baekdal)

The crap the old media people put out is simply staggering, especially from the constant barrage from people trying to save the newspapers. The latest is this version of "We need to change copyright laws to save newspapers."

First, Eric Clemons goes on to name the enemy: The news aggregators, you know, Google!

Using aggregators like Google and others, I can access essentially in real time the lead paragraphs of almost any story ... Not surprisingly, traditional print media publications are dying, and not surprisingly their owners' online dotcom alternatives are generating far too little revenue to pick up the slack; why pay for any content when the essence of everything is available immediately, and free, elsewhere.

Why would people indeed!

But, the monstrous failure here are not the news aggregators. The monstrous failure is that he doesn't realize the real enemy is "everything is available immediately, and free, elsewhere."

This is business 101. If two companies make the same product you have a pricing war. If, in the case of newspapers, several thousand newspapers make nearly identical stories, the pricing war reduces the price to zero.

The news aggregators provide free exposure for your stories! If you fail to sell a product, even when you get massive exposure trough tons of channels, then you need to rethink the product you make.

I simply do not understand why the newspaper people don't get this. This is not rocket science, or even complicated math. It's purely common sense.

Eric Clemons then goes on to suggest that the solution is tightening of the copyright laws to:

A first suggestion would be to provide newspaper and other journalistic content special protection, so that no part of any story from any daily periodical could be reposted in an online aggregator, or used online for any use other than commentary on the article, for 24 hours; similarly, no part of any story from any weekly publication could be reposted in an online aggregator or for any use purpose other than commentary, for one week.

Followed up by the most misguided conclusion I have heard yet:

However, the net is a pretty robust institution by now, and if we were suddenly not able to access articles from the Post (Washington or New York) until they were 24 hours old the net would, indeed, survive.

What? ... I... you... ...what???

The net would indeed survive if you blocked content from appearing for 24 hours? The net would survive if people could not point readers to a new story for 24 hours? The net would survive if we could not share a story for 24 hours?

What kind of silly parallel universe does he come from?

This would destroy any form of viral sharing of stories.

Here on baekdal.com, new articles are usually shared by a relatively small group of core readers. They then provide the exposure to get it moving. After a few days, many people are sharing the articles, but it all starts with the core readers.

If the core group of readers weren't allowed to share stories for 24 hours, then they wouldn't share any story at all. Nobody goes back to a site to share something they found yesterday. And with no initial sharing, there is no follow up by a much larger group of readers.

The articles never grow!

You know, let's do it their way

I have a suggestion. Let's agree to do it their way. Lets invent a new meta tag that defines from what point in time content may be shared. Something like:

This says that the content may not be reused in anyway, but it may be shared on e.g. Twitter from a certain date.

And let's put it into copyright law that all sites, news aggregators, and social services must adhere to it.

Then these silly newspapers can dig their own grave by shutting themselves completely off the internet.

Because while they are using the new meta tags to block readers from finding their articles, you and I - who actually know how the internet works - can use the same meta tags to our advantage.

This says that while you may not republish the article in full, it may be used in all other aspects. But, you may not quote the content unless the destination site also adopts the same licensing rules to the target article.

This would mean that newspapers, who block their content from the internet, cannot use content from e.g., blogs. Newspapers would have to write all their article themselves, without taking quotes from other content sources!

This would give us a serious competitive advantage. The sites that allow sharing and aggregation can take advantage of the full power of the internet. While the old newspapers, who want to control consumption, can do so, but at the cost of not being able to use other content sources in their article.

They can't have both strict control over their articles, and freedom to use other peoples content to make them.

We could even have a little fun with the old newspapers by doing this:

Which means that you can quote content from the article, *only* if you adopt the same rules? But, it is fully allowed from September 23th (a month later).

Imagine if Google did this on their blog. Then Techcrunch, Mashable, you, and I could write about it immediately, and include quotes provided by Google to enhance our articles.

But newspapers, with a more restrictive license, would not be allowed to write about it until next month. They could link to it (and give Google free exposure), but not write articles to be sold behind their pay walls.

Let's see how their so-called net would "indeed survive" then.

The bottom line is...

The average newspapers product sucks. It is massive duplication of available content, redrafted press releases, and republished stories, and quotes from other sources. And even when they produce content on their own, what they are really doing is to tap into the world of citizen reporting.

Not all newspapers are doing this. Many news sources have change a lot in recent years, and are focusing more on creating truly unique content.

News aggregators aren't a threat to unique content; it helps us to get massive exposure and sharing. It even helps us to understand the popularity of an article better, providing us with a vital tool for improving our next stories.

News aggregators are only a threat to the newspapers who have nothing to tell, who is merely making noise. If those newspapers want protection from being included in our social news streams, then that's fine by me.

That just means that I will get less noise and more substance. Hurrah for that!

Of course, I hope we do not have to go this far. It's a bit extreme to pass a new copyright law to show the old media that it would just kill them faster...

Advertise on Baekdal.com - (by @baekdal)

Baekdal.com is the perfect place to showcase your products.

Contact Baekdal.com to enquire about advertising - ads@baekdal.com, or visit BuySellAds to buy ad space

Traffic

• 300.000-400.000 visitors per month (absolute unique visitors)

Demographics

Baekdal is read by people from USA (65%), United Kingdom (7%), Canada (6%), Germany (2%), and Australia (2%), with the rest of the world making up the remaining 18%.

Men accounts for 60% of the traffic and women accounts for 40%. The site is read by people of all ages with 18-34 being the largest demographic.

Advertise on Baekdal.com

Baekdal.com use BuySellAds for our regular ad formats. You can read about the specific formats and pricing here:

Buy advertising space on baekdal.com here

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Sponsored Articles

Baekdal accepts sponsored articles. Sponsored articles are written by a company to as way to link a valuable article to a company brand. Each article is preceded by a short paragraph introducing the company or brand who sponsored the article, with a link to the company or brand.

Sponsored articles costs a one-time fee of $250

All sponsored articles must adhere to normal guest posts requirements.

Special campaigns

We also offer special advertisers to create special advertisements for campaigns. With a special campaign you will have exclusivity, and you can create much bigger and more prominent ads.

A special campaign starts at $20 CPM

Ad screening

All ads will be screened before they are accepted. Baekdal is about quality, and believes very strongly in only showing relevant ads. These following types of ads will, by default, not be accepted on Baekdal.com:

• Spam, Phishing or scam ads
• Adult ads of any kind (including ads for dating sites)
• Political ads
• Obscene, violent or offensive ads
• Ads that appear to be endorsed by Baekdal.com
• Anything related to casinos, pills etc.

Other ads will generally be accepted, but Baekdal reserve the right to refuse any advertisements for any reason.

Animated ads will only be accepted if they look nice, and doesn't cause uncomfortable distractions. Blinking, spinning, or flashing ads will not be accepted.

Contact

Contact Baekdal.com to enquire about advertising

ads@baekdal.com

Does Facebook Places Change Anything? - (by @baekdal)

Earlier today, Facebook launched its location based service called Facebook Places. We all knew it was coming, and that it would not be highly innovative, but there were still a few surprises.

Facebook Places is basically the core location elements of what we know from Foursquare - without the badges, the majors, the statistics, and the ability for brands to use it for promotions etc. You know all the things that make location based services exciting.

Instead, they are only going to do four things.

1. You can check in at a place...
2. You can find where your friends are, or see other people at your location
3. You can find places around you.
4. You can "tag" yourself or a friend to a place, just as you can tag your friends in photos. (And by doing so you publish it to the wall of both you, your friends and the place)

It is unimpressive. It is what you can do in Foursquare, *before* you really start to use their app.

Then there was the big disruptive part. Foursquare, Yelp, MyTown, and Gowalla is looking to integrate with Facebook Places.

Boom! That changes everything.

Facebook has effectively positioned themselves as the platform of all location based services. If I were Google or Twitter I would be scared. Really scared!

It was surprising to see them all on stage, and as I tweeted earlier:

Partnering with Foursquare, Yelp and Gowalla... I don't get it. It limits them to become *extenders* instead of platforms. /@baekdal

Badges is a gimmick, it will grow old fairly quickly. So are stamps and most of the other stuff that Gowalla and Foursquare are doing.

What matters is location as a service. Not location as a game, or a check-in.

Interesting enough, after the announcement VentureBeat discussed the future with Dennis Crowley, Foursquare's CEO... and apparently they are not as excited about it as it first appeared.

Crowley said that Foursquare hasn't committed to anything because the team still needs to try out the service.

While Facebook might seem like a giant able to crush Foursquare, Crowley emphasized the different missions of the companies. The core of Foursquare is check-ins " getting people off the couch and into the world to try new things and share with friends " while with Facebook check-ins are just another feature.

I think Dennis missed the big picture here. I do not think Facebook sees this as another feature. I think Facebook sees this as a way to become the platform.

Foursquare and Gowalla have the wrappings, but Facebook provides the substance. That has worked well for Zynga and FarmVille, but only because Facebook themselves have no desire to create games.

Right now Foursquare is facilitating the location based activities (the check-ins), but in the future that will be taken care of directly by the brands and companies. Especially if they have a platform like Facebook to use as the engine.

The future of Foursquare and Gowalla will be limited to extending a location (the gimmicks), instead of being the channel.

But, what is much worse is that Facebook is now free to innovate at their leisure. Each time they launch a new feature, Foursquare and Gowalla will see another piece of the pie disappear.

It's not about the features (they are practically non-existing), it's about Facebook taking control of the *location platform*.

Facebook has all the people, the photos, and what they share (99% of location based interaction). All they needed was the places (the 1% that is the metadata that ties it together to a location).

What they don't have is the "games," - the badges the majors and the stamps. This is what Foursquare and Gowalla brings to the table. They are extensions, the activities and the fun add-ons.

They also do not have the vital connection to companies and brands. Foursquare still holds the keys to this. Facebook displayed a severe lack of brand integration at the announcement.

You doesn't seem that you can integrate into your existing brand's Facebook Page. You can "claim" a place, but it sounds like that will just create another community page (and that is already a nightmare for brands). Another business page for "a place" is, well... not funny.

This is a real shortcoming to Facebook Places. They are looking at it from a perspective of "what people do at a place" (which is very important), but lack the vital metadata about what that place is about.

Update: You can actually merge you Facebook Place with you Facebook Page, and then a place behaves just like a normal page. This just made Facebook Places 1000% more interesting!

It is going to be exciting to see just how far Foursquare and Gowalla are going to "integrate". 500 million people is a tempting offer. But is it so tempting that they are willing to let Facebook control the platform?

How long will it be before we see a "check-in via Facebook", just as we see "sign-in via Facebook"?

The really big question is. If they use Facebook as the platform, do they trust them not to add features that compete with what e.g Foursquare is doing "extra"?

On the upside: This might just be incredible good news for brands and companies. Today it is hard to do location because it so small, and none of the players really dominate. If they all integrate with Facebook places then the brands can just update one site (their Facebook Place page), and it would be visible on both Foursquare, Gowalla and MyTown.

+ Location based interaction via Facebook, where most of your customers already have an account? Now that's interesting!

--

More on location "The Future of Foursquare/Gowalla" (published earlier), and coming up is "What Facebook Places Really Means to You"

Why Traditional Ads Work, and Digital Ads Don't - (by @baekdal)

In the midst of the media's frantic search for a viable business model, we often hear media executives telling us that people *want* to see ads in traditional magazines. And it's true. In traditional magazines, ads actually work.

What the same media executives completely fails to understand is why they work. They think it simply about creating visually stunning ads. But that is not why they work at all.

It is really pretty simple. Ads work when they are extending the content. Ads don't work when they are disrupting the content.

Take the fashion magazine "Elle". Below is a page from the August print issue. On one side you see an article about fancy designer shoes, and on the other there is a highly targeted ad from Jimmy Choo.

Another page is showing "editors picks" of beauty products, on the right there is a highly targeted ad about the same thing.

Or what about this?

Advertising works in traditional magazines because they are extending the content. It is part of the content itself. It provides editorial value.

It doesn't matter if you see new styles from the editors of Elle, or via an ad. Both present you with new products, new looks, and new things to try.

That's why they work. It's not about advertising. It's about content.

Ads that doesn't work

There are also a number of advertisements, in traditional magazines, that don't work. One of them is this one from Gap.

It's not extending the content. It is just graphics. You cannot see the products. This ad doesn't work! It is wasting space, making people to flip to the next page.

Another example is this ad for some kind of wine. You have an article about bags, and then you are showing wine. It's useless. It doesn't provide any value. It just wastes people's time, making them flip the page faster.

Another fallacy is that most traditional marketing people believe in unverifiable data. E.g. Elle has 1.1 million monthly readers, so if you place an ad in the magazine, how many will see it? The correct answer is not 1.1 million people!

People will not see every single ad in every magazine. They are incredibly adapt at spotting advertisements, and will simply block them from memory.

My guess is that less than 1% will be able to remember the name of the wine displayed above. Just look at yourself. You had to look a second time too. You didn't remember it either.

But, advertisements actually work when it extend the content. The Jimmy Choo ad is probably extremely effective. It's mixing editorial content with relevant ad-content.

That's how it should be done.

Ads online

Online advertising, however, is completely missing the point. There is no real connection between the content and the banner ads. And because it is a banner ad, it is not accepted as content.

Take a look at the screenshot from Elle's website. Apart from an already cluttered website, the ads are completely irrelevant. People, who read this article, are interested in "self-tanner tips" not Frappuccino.

The ads on this page are not an extension of the content. It is lowering the value of the page.

Traditional advertising extends the content, and enhances the value. Online advertising disrupts the content, clutters up the page, and lowers the value.

That's why online ads doesn't work.

It wouldn't make any difference if the Frappuccino ads were made bigger and more interactive (like Apple is doing with iAds), because it is *not* extending the content.

Bigger ads would just be more annoying. It's like the Gap ads in the magazine. Two full pages that you have to flip before you can see something interesting.

It is same when it comes to viral videos and social media channels.

The Old Spice campaign worked because it wasn't an advertisement. It was many small socially focused stories. The old spice campaign was *content*.

In comparison, Cisco, who tried to copy Old Spice's concept, failed because they turned it into an advertisement.

They didn't tell a story, they used another company's story to create an ad, and they failed.

Right now, the (online) advertising market is fueled by many clueless marketeers who does not understand why their ads do not work. Followed by clueless media people who mistakenly believe that the size and interactivity of the format are the key element.

You can take advantage of that. You can lower your value to easily digested snacks that attracts many ad impressions. But by doing so it will also be impossible for you to get people to pay money for the articles.

The best strategy is to focus on creating value. Advertising in itself is worthless. Extending the value around your product is worthwhile.

Google and the loss of Net Neutrality - (by @baekdal)

You have probably heard about all the buzz around net neutrality, the concept of equal access to the internet.

ISPs wants to be able to limit bandwidth to certain sites. It officially prevent misuse, but in reality it is to get big companies to pay for exclusive deals to get a competitive edge.

Google, who positioned them as the defenders of net neutrality, has now done a complete 180 on the topic. Instead of promoting net neutrality, they are now saying that it should only apply to wired broadband connections, not wireless.

The set of seven proposals guarantee equal access to the internet and call for the prohibition of wired broadband providers from discriminating between different kinds of internet traffic to ensure that no-one can pay to have their traffic treated more favorably.

When it comes to wireless services, search giant Google and Verizon said the same rules would not be applied.

We both recognize that wireless broadband is different from the traditional wireline world, in part because the mobile marketplace is more competitive and changing rapidly,

(Via "Google and Verizon's vision for open internet" by BBC)

Also read: Google-Verizon Pact: It Gets Worse

This is just pathetic - for two reasons.

1: What do you think the future is about? Wired or Wireless internet?

We all know it is only a matter of time before the wireless internet takes over. Just as we have moved away from land-line phones, we are also going to move away from wired broadband connections.

Google want freedom when it comes to their data centers, and are sacrificing our (the consumers, the startups etc) net neutrality to settle the matter with the ISPs.

It sounds like an Open Internet, but it is much closer to what we have today.

2: Who do you think benefits from priority access when it comes to wireless broadband? Yup, Google!

With this they can pay for premium access, so that when you use GMail, things work really fast. But, when a new startup wants to do something better, they cannot get the same internet throughput.

As Adam Green said

Google, a company that I've long admired and currently hold thousands of dollars of stock in, just 'went evil.

The bottom line is: When I buy a wireless broadband connection from an ISP, I expect them to deliver whatever speed I pay for. They have no right to say: "Well, we know you have paid for a 10mbit connection, but you are only going to get the full speed when you are visiting Google's sites. If you want to use Flickr, then we only give you 5mbit."

The very idea to not have full net neutrality is simply a violation of our internet freedom. I decide what I want to use my internet connection for. No one else.

As Obama said back in February: "I'm a big believer in Net Neutrality ... we don't want to create a bunch of gateways that prevent somebody who doesn't have a lot of money, but has a good idea, from being able to start their next YouTube or their next Google on the Internet."

I'm not a socialist by any means, but I am a strong believer in equal capitalism. If I want to start a new company, I don't want my potential success to be limited because some rich dude has made a special arrangement with my ISP.

Let the best service win. That's what a free market is all about. That's what net neutrality is all about.

That's our basic right!

The Future of Foursquare/Gowalla - (by @baekdal)

After writing "What Matters is the Trend, not the Moment," one question immediately comes to mind; is Foursquare and Gowalla going to last?

In its current form, no they are not. Right now, it is similar to when people on Twitter spent most of their time telling their friends what they had for breakfast.

On Foursquare it's simply *where* people are having breakfast, when they out shopping, standing in line at the post office, or waiting at the train station etc.

It's crap. There is no value in every day activities because they are so common.

The other part, about being rewarded and earning badges, will grow old fairly quickly. Especially when it becomes widespread and the discount and offers will diminish in value (due to size of the audience), or be limited to a very small user base (like only rewards for the Major). The majors are those ones who visit you store anyway. It is not where the real value is. The real value is in the long tail.

WholeFoods is doing the right thing. They are focusing on promotions that apply to everyone. The Major is just one person - a tiny percentage point of your customer base. Anyone checking in five times, that's practically every regular customer.

(photo credit: Dennis Crowley / Foursquare co-founder)

But the offer is insignificant. A small scoop of house-made gelato? Come on! It is interesting now that it is all new and exciting, but in a year, when location based offers are everywhere, it is not worth the effort.

Many stores already have loyalty programs in place. In the past many stores had special card that you could show at the counter. Every time you bought something, you will earn points that could then be used for discounts or special offers.

And you know what? They work, but not so much that they are worth keeping. My local grocery stored did this years ago. They stopped doing it because the rewards were too small to offset the inconvenience of "checking in." Instead of doing it with an app, they just used a card with a barcode on it.

What we are seeing right now is the novelty of the new and the trendy. For brands, that is an important element, but it is not the real of potential of location based services.

It's a new way to explore; it is new data that we didn't have before. But like Twitter, we quickly discovered where the real value was.

It's not about everyday activities, it is about the special things, the knowledge we can share, connections we can create, and people we can follow.

We will see the same evolution with location based services. Twitter is about the value of people and what they think/feel/know. Location based services is about the value of people and the places that matters to them.

What also matters are the customer experience, the feeling of belonging and being treated as a special person. And it matters that it is socially connected to the world. Sharing something is incredibly powerful.

Or think of it this way: It is much more powerful to simply remember your customers by sight. Threat them well when they revisit your store, or give them a bonus when they bring a friend. Don't just look at people as a general mass-market, only distinguished by a badge on their phones.

You don't need Foursquare to give people a great experience. You need Foursquare to market that experience and your customers need Foursquare to share and extend it beyond your control.

Foursquare is the glue, the rewards/discounts/badges are the incentive, but the value is in sharing the experience, and feeling proud that you did.

Nike could easily extend Nike Plus with Foursquare. Allow people to share not only their exercises but also where they took place. They could reward you for running with friends, for checking in at two point a certain distance apart - in under 30 minutes. Take part in Nike sponsored running events etc, and give you special discount based on how fast you got from one check-in to the another.

Fashion shops could partner with each other. So that, if you buy a pair of shoes in one shop, and a matching dress in another, you can get a limited edition scarf in a third. Suddenly you have higher sales across competing shops.

You could make people VIP (by checking in ten times or more) and give them the power to give their friends a special discount. Then it is no longer you who give a discount to a mass-market. But, your fans giving their friend's discounts to your shop.

Use location to create niche-communities. Use it make people feel they have accomplished something, take it up a notch if they share it.

As a business you need this. You have to be a part of the movement. With the mix of social and location, the experience of a place suddenly becomes a very influential element in your level of success.

But don't go out and create $100,000 Foursquare marketing events. Start small and create value. Give people a reason to check in and focus on the person.

And, don't use location based interaction if you don't have a location based business. It makes sense for companies with physical stores, events that's centered around a place, or where people meet.

But, it doesn't make sense for e.g., companies like Hulu or Amazon. Nor does it make sense for newspapers and magazines. For them it is just marketing, there is no real engagement.

It must be "for real."

Also remember that the traditional way of looking at location is very limiting. Location, in a digital context, is more than a physical location tied to a GPS position.

One example: Disneyland is a location but it is not a single location. The traditional mind would focus on each location, not realizing that people can share experiences across the planet in real-time - or even asynchronous.

The digital way of thinking is to look at Disneyland as a single place, shared by people on three continents.

A train or an airplane is shared location, but it constantly on the move. A concert is a shared location, but it moves from country to country while it is on tour.

GPS is only a small part of the real potential of location based services. That's the traditional mind limiting the future to restraints of the past. It's really about sharing an experience - and creating lasting value with that place.

Experiment, try new things!

What Matters is the Trend, not the Moment - (by @baekdal)

You probably remember the chock wave that rippled trough the social media community after Forrester found that the location based market is insanely small (1% of users), and Foursquare is dominated by men (80%).

Not only was the study factual incorrect, according to Foursquare the actual male-female ratio is 60-40%, but it also points to another very important point.

It doesn't matter how many people use it. What matters is the trend.

Every single day a new study is released telling us where something is. E.g. about 1% use location based services, and about 96% have never even heard of them.

And the result is that the media, people, and companies are now telling themselves that this location based thing is just a buzz word, and not worthy of their attention. They should wait to see whether it grows big enough.

That is the quickest way to fail.

Take Facebook. Most companies have just started using Facebook in late-2009/early-2010, many still do not use it. And all of them have been "waiting for it to grow, before acting."

The result is that they are now way behind. It takes a very long time to build a valuable fan base. It easy to get fans, just look at Old Spice. But, it takes a lot of time and dedication to create fan base that creates a lasting ROI.

Companies should have started using Facebook in 2007, back when they only had 15 million users. Then in 2008, companies should have expanded their Facebook usage to an active social strategy with specific ROI goals.

So that now in 2010 (where Facebook has grown into a dominant size) you no longer have to focus all your efforts into getting fans, instead you can focus on meeting their demands. You can focus on what actually creates ROI, instead of it being an expensive channel for attracting attention.

It's exactly the same with location based services. It doesn't matter where something is right now. What matters is where it is going, and where you need to be going too.

Location based services are just getting started. It started in 2009, and now, only one year later, it has reached 1% of the population. By any accounts, that is huge. That's three million people in one year.

But, what's really interesting is where this is going. We do not know the future for certain, we can only predict it, but location based services - or more so - location based integration into other services, looks to be very promising.

Don't make the same mistake that most companies did with Facebook. Start now, not as a huge campaign, but start small. Build trust, engagement, and followers.

It's going to produce a negative ROI for a while, and there is a lot of risk involved. But, if you don't act, you end like all those companies who are now trying to catch up to their competitors on Facebook.

Many companies who started in 2010 will never reach their full potential, because there is now an abundance of Facebook pages to follow. In 2007, you merely had to be there to build fans. Now, being there has no effect. Now you have to cut trough the noise of a million voices.

They started too late.

It's like racing. It doesn't matter that you can drive 1 sec faster than your competitors, if you always start the race 2 hours late.

The Real Pay Wall - (by @baekdal)

Newspapers continue to struggle making their printed newspapers profitable (a losing battle), but here is an idea. Why not turn it into a rather nice looking wall covering? This is probably the only pay wall that actually works!

This, at least, is the concept from Weitzner Limited. They cut the newspapers into strips, and weave them together to form a continues roll wallpaper. It is a new way at looking at sustainability, and recycling. But it also create an interesting backdrop for anyone who is in publishing.

At some point, when the printed newspapers go away, they are probably going to run out of source material. But, right now that isn't a problem. The New York Times alone consumes 154,000 metric tons of newsprint paper per year.

That's a lot of wall coverings!

The New Audi A7 Sportback - (by @baekdal)

Yesterday, Audi revealed their new Audi A7 Sportback. Audi is a master of subtle design (much like Apple), the new A7 isn't drastic in any way, it's design simple, yet it convey a very strong image. The only real change is the design of the back trunk.

Mechanically it has been slightly updated, but in many ways it very traditional. It's fast though 0-60mph in 5.6 seconds, and a limited top speed of 155 mph.

I must admit that I have a bit of a soft spot for Audi's.

Digital Journalism Study 2010 - (by @baekdal)

Every year, Oriella PR is doing a study among journalists on how they see the future of media, and what they focus on.

This year's study, among 770 journalists in 15 countries, is very interesting. Clearly people are starting to "get it." In change management terms, we have moved from a period of denial to a new period of acceptance.

Journalists are more optimistic, and the financial crisis is less dominant.

But, there is also a very clear trend against traditional media. 53% thinks print will be taken off the market, up from 32% last year. More people think the future is digital only (but still at 14%), and only 25% now thinks that people "will return," down from 42% last year.

However, only 44% thinks that print will shrink dramatically, down from 59%. This is quite a conflicting trend. More people think that print will be taken off the market, but fewer people think that print will shrink.

To me this indicates the split we see in the media industry. One group embrace the change; another group does not believe the change is real.

It's the Netflix vs. Blockbuster all over again. Netflix believes that DVD renting will disappear and focus on digital streaming. Blockbuster focus their efforts on their brick and mortar business, and their digital content strategy is almost nonexistent.

everyone agrees that the new media changes will result in a loss of readers and advertising income.

Social media adoption is also interesting. Social media newsrooms are up by 90%, while almost all other channels are down by 20-30%. But the traditional communication channels still dominate.

The media industry is still largely stuck in the traditional world. There is still a lot of uncertainty, and the new channels are growing but not yet dominating. The 30% still believes that new sources of revenue can come via "free access to online content for print subscribers" - good luck with that.

But the media is changing, and there is hope in the horizon.

For a more detailed summary, take a look at the video below. You can also download the full report from here.

And, let me know your interpretations in the comments.