Revolutionary Measures

How my consultancy is bigger than Facebook UK – and that’s a bad thing


I’ve been in business for five years now, and things are going well. I’ve seen revenues for my PR agency grow every year, thanks to loyal clients and (if I say so myself) some wonderful work. Yet it was only when I saw how much corporation tax Facebook paid last year in the UK, that I realised exactly how well I was doing. Comparing our two tax bills, I’ve paid considerably more than the £4,327 Facebook shelled out in 2014. Therefore it stands to reason I must have made much more money than the social network, even if globally its profits were $2.9 billion. Its UK business must just be lagging behind the rest of operations – after all very few people use Facebook in this country.

Facebook logo Español: Logotipo de Facebook Fr...

Obviously this isn’t the case, and like companies from Starbucks to Google, Facebook has engineered its operations to minimise its tax bill. As a businessman myself I can understand this – but what I can’t understand is that it doesn’t take into account the reputational damage that results. After all, company filings are public documents that anyone can access, and there are enough people out there who know how to read a balance sheet and can therefore spot holes in a company’s story without needing to spend too much time investigating.

I even felt sorry for the poor PR spokesperson delegated to read out the anodyne statement that Facebook was compliant with UK law, and all staff paid income tax (how gracious!). Then I realised that the spokesperson was one of the 362 people that shared the £35.4m in bonuses that pushed Facebook’s corporation tax bill down so close to zero, and any sympathy evaporated.

On one hand companies talk about how important their brand, and brand values, are to their success, yet cheerfully spend their time undermining these very same values from within. Why? I think much of this comes from a fundamental disconnect between senior management and those responsible for public relations or brand reputation. They aren’t involved in senior-level decision making, meaning that no-one is pointing out the potential pitfalls of being seen as a poor corporate citizen. In an age of consumer power, the lack of a check on potential corporate skulduggery can prove fatal to a brand.

Ever since I’ve been in public relations, which is over 20 years, there have been calls for PR to have a seat on the board and to be more involved in setting strategy, rather than just delivering it. So why hasn’t it happened yet? Partly it comes down to PR’s own reputation, with the discipline seen as more Ab Fab than strategic, and limited in what it can achieve. The rise of digital and the increase in the importance of corporate reputation should have changed that, but my impression is that the overwhelming number of FTSE 100 companies still don’t have or seek senior level PR counsel until too late in the process.

It is therefore time for PR people to take a step up and build the business understanding that they need to communicate with other senior management. Talk their language, link campaigns and messages to business goals and objectives, and if necessary, scare the bejesus out of people by explaining the financial (and even judicial) consequences of not thinking through decisions or ignoring dubious practices. While Facebook’s tax policies haven’t hit its share price, just look at Volkswagen’s financial woes for an illustration of what happens when you cover up bad behaviour. Despite its US head admitting he was briefed on how the car maker could fool emissions tests in spring 2014, nothing was done to remedy the problem or to come clean.

Looking at the PR implications of business decisions shouldn’t just be limited to big companies with expensive communications departments. Every company has the potential to be caught out if it transgresses the brand values that it trumpets to the world. So whether you are an international social network or a local plumber, think through the PR consequences of your strategy, before you implement it, if you want to avoid potential long-lasting reputational damage.

October 14, 2015 Posted by | Creative, PR, Social Media | , , , , , , , , , , | Leave a comment

Will Facebook take over the world?


Facebook logo Español: Logotipo de Facebook Fr...

Last week Facebook announced that on Monday 24th August 1 billion people logged into the social network. That’s 15% (almost one in seven) of the world’s population using Facebook in a 24 hour period. And given that over half of the globe still isn’t online, the percentage of actual versus potential users is actually much higher – closer to 33% of the 3.195 billion internet users.

The announcement begs three big questions:

1.Is it a good thing?
It is difficult to find a parallel in history for a single entity being used by so many people across the world. There have been monopolies in the past of course, particularly in telecoms before deregulation, but these operated at a country level, and you didn’t have a choice. You wanted to make a phone call and you had to use BT or AT&T. When it comes to control over how people communicate the only example that comes to mind is organised religion, such as the pre-Reformation Catholic Church where all of Europe was subservient to the Pope. As yet, Mark Zuckerberg hasn’t branded any Twitter users as heretics, for which we should obviously be grateful.

Critics will argue that having one company central to how we communicate with friends and family, find our news and even shop is a bad thing. On the other hand, Facebook fans will point out that you have a choice – other social networks are available and the past is littered with previously successful companies (such as MySpace) that failed to evolve. This does ignore the impact of the network effect – as more and more people are on Facebook, it becomes increasingly necessary to be on there if you don’t want to miss out. Technically it is very easy for anyone to create a new social network, what is difficult is enticing enough people to join to make it necessary for their friends to also jump aboard.

What is definitely true is that Facebook, like other international online giants, does need to scrutiny that matches its power and reach. I’m not talking about regulation per se, but any organisation that has Facebook’s combination of personal demographic data and ability to analyse it on a grand scale has to meet the highest standards of behaviour.

2.What about the other 85%?
The obvious point that many people have made is that if 1 billion people were on Facebook on a single day, the remainder of the world (85% in fact), were doing something different. As we’ve seen, Facebook has captured a large percentage of the online population, which is why the company’s efforts are being put into increasing the number of people with access to the internet in some form. Its main vehicle for getting people online is, which provides free basic internet services in areas where it is either non-existent or unaffordable. Some of the ways is looking to extend coverage include high altitude planes beaming a signal to a particular area, lasers and satellite technologies. However has attracted criticism for only providing access to a walled garden of services, including (surprise surprise) Facebook itself.

Clearly if Facebook is to grow it is easier to expand the pie of internet users and reach the currently unconnected, rather than target the refuseniks in countries where it already enjoys high penetration rates. Expect more efforts to extend internet access – probably not just within developing countries but also within ‘notspots’ inside existing markets, thereby encouraging people to use the service even more.

3.Where next for Facebook?
Facebook has already overcome two major hurdles that have defeated its rivals. It has successfully transitioned to a mobile-first world (87% of access is from mobile devices), and is generating growing profits. As well as extending its reach to new victims (sorry, consumers), it also needs to increase engagement – i.e. ensure people still log on and use the service, and do it more often and for longer. The big bet that Zuckerberg has made here is on virtual reality, with the $2 billion purchase of Oculus VR expected to spawn headsets that deepen the experience of using Facebook and interacting with your friends. This, for me, is where things start to get more than a little creepy – if people are addicted to Facebook now, just imagine the time they’ll spend online if they can essentially experience reality without leaving their screen. Plus, with the current size and design of headsets, everyone will look like they are part of Daft Punk.

So, to answer my three questions, I’d say we should be wary about Facebook’s might, keep an eye on its efforts to reach the other 85% to ensure there is a level playing field when it comes to access, and be sceptical about the advantages virtual reality can actually bring us. After all, you could just pick up the phone and talk or, heaven forbid, chat to someone down the pub……

September 2, 2015 Posted by | Creative, Social Media | , , , , , , , , , , , , | 1 Comment

Football crazy? Can clubs control the media?

The new football season is already nearly a month old, and while action on the pitch is taking centre stage, how fans get information about their team is also becoming a hot topic for debate. Several clubs, such as Swindon and Newcastle, have banned certain newspapers from attending their press conferences or talking to their managers and players. The reason? They prefer to communicate direct with fans through club websites, newsfeeds, social media, apps or even in-house TV channels. Scottish club Rangers has even banned particular journalists due to not liking the articles they’ve written about the club’s governance or finances.

Polish Football Fans 001

In a way this approach simply fits with the ability of the internet to remove middlemen (in this case the media) and to connect brands directly with their audiences. However it also sets a dangerous precedent – with coverage reduced to happy soundbites stage managed by the club’s PR team. The decline of newspaper and magazine staff numbers has tipped the balance in favour of big brands, with many journalists now using their skills to publicise companies and PR agencies. Football teams are not the only brands aiming to do this, using the distribution mechanisms of the internet and social media to get their message out unfettered by the critical filter of the press.

As a PR person I can see the initial attraction in this – after all, what marketing manager doesn’t want guaranteed 100% positive coverage? But it isn’t sustainable. One of the reasons for the rise of PR was that an independent article in a newspaper or an interview on the radio was more believable, and therefore worth more than an advert. While the internet has blurred the lines, I’m convinced people still react best to coverage that delves deeper than a press officer’s prepared statement. Football is the perfect case in point – fans may love their club, but be intensely suspicious of the owners, board, manager or particular players. Take the frequent demonstrations at matches and the vitriol directed at players on social media. Therefore simply providing bland statements of how the new centre forward is looking forward to the season ahead and how wonderful the training facilities are, is not going to keep true fans interested or happy. At the same time social media, while providing a channel for brands, also actively undermines them by making it easy and fast to share unofficial information. This could come from anywhere – a disaffected (or unthinking) player, a taxi driver that overheard a conversation or a barman that saw that same new centre forward slumped over his pint the night before his debut.

What brands (of all sizes) need to realise is that you need three different types of content (paid, earned and owned) to build your profile. There is paid media, essentially advertising and sponsorship, where it is normally clear that money has changed hands. Earned content is when a third party (which could be a publication or simply a fan on social media) shares or publicises your messages. Finally, owned media are the channels you control – from in-house TV channels to websites and Twitter feeds.

Successful brands combine all three of these in a cohesive way that builds engagement. Fans will want to the chance to interact directly with you and get information straight from the horse’s mouth, but at the same time they want independent verification through trusted third parties such as the press and the backing of their peers through social networks. And these same social networks provide the platform for independent fans and commentators to create and share their own content, outside the club’s control. Therefore the football clubs that have succumbed to the beguiling fantasy of controlling the news should take a step back and look at organisations and countries such as Soviet Russia that have relied on propaganda. Citizens stop believing in the news they read and before too long even the most rigid states begin to show cracks and eventually collapse.

August 19, 2015 Posted by | Creative, Marketing, PR, Social Media | , , , , , , , , , , , , | Leave a comment

Are startups solving the right problems?


I don’t think there’s ever been a better time to launch a startup in the UK. The public profile of the tech industry is incredibly high, and those that create businesses are more likely to be seen as visionary entrepreneurs than cranks who couldn’t get a job in a proper company. Indeed, for those leaving university, setting up your own startup is a valid (if not as initially lucrative) alternative to becoming an accountant, banker or lawyer. I’m sure startups would complain that it is still difficult to raise money, or scale up their businesses, but it feels that there is now wide public and political acceptance of the importance of creating a culture that encourages startups.

Relief map of Europe and surrounding regions

Read the press and politicians’ speeches and there seems to be a relentless search to find the ‘European Google’ or ‘British Facebook’, multibillion dollar global companies that can become standard bearers for the industry. Alternatively, other European companies essentially mimic what is being done in the US, taking their business models, localising them and then hoping that first mover advantage will let them create viable businesses before the original enters the market.

The people that run startups are smart, as are the venture capital funds that back them. But are they looking in the right areas when it comes to creating new businesses – as an article by Liam Boogar in Rude Baguette recently asked “Where are the European startups to solve Europe’s biggest problems?” Leaving aside the question of whether Europe is cohesive enough that the same problems apply to life in Edinburgh, Athens and Bucharest, it is a valid point. What issues can be solved, first in Europe, and then expanded globally, to create thriving companies that benefit us all?

The article focuses on the need to shake-up the savings market, and with interest rates in many countries close to (or even below) 0% I can see the opportunity to transform the sector, such as through peer-to-peer lending.

However, what other areas would enable European startups to build global businesses? Thinking about the particular problems Europe faces, here are four that come to mind:

1. Healthcare
Across Europe, people are living longer and birth rates are falling. Longer lifespans increase pressure on health and social care services, as the elderly battle chronic diseases and poor health. While this isn’t just a European problem, it is one that startups can focus on, particularly given the public money currently being spent on healthcare research. Areas such as wearable monitors and the Internet of Things can potentially help improve the quality of care, even allowing people to remain in their own homes, rather than be treated in hospital.

2. Transport
From driverless cars to drones, technology is revolutionising transport. With its combination of major car and aeroplane makers, Europe is well-positioned to lead the way, but it needs an injection of startup energy and fresh thinking to succeed. Whether it is new ways of charging electric vehicles as they wait at traffic lights or smarter cities where you are automatically guided to the nearest parking space, there is plenty of scope for innovation, along with the chance to scale up to export the technology across the globe.

3. Employment
More than 6 million jobs were lost in the recession between 2008-13, and youth unemployment in many countries remains high. Many of the roles that were made redundant are simply not coming back as they have either been offshored to lower wage economies or replaced by technology. What are needed are ways to reskill European jobseekers so that they can compete in the global market. Much of this should be the responsibility of governments, but technology can help with new ways of training, new opportunities for collaboration and the encouragement of remote working to combat rural depopulation.

4. Cutting bureaucracy
All governments, of whatever political persuasion, seem to delight in creating red tape that tangles up citizens and businesses alike. And, despite the European Union, there is still a range of different measures that need to be met. Many countries have begun to put their services online, but more can be done, and in many cases nimble startups can get things done quicker than lumbering government departments.

I’m sure there are plenty more European problems that need solving, from the environment to education. These don’t just benefit society, but are potentially extremely lucrative as well. So the challenge for startups and entrepreneurs is to try and solve them – and at the same time we might create the European Googles that politicians are so keen on.

August 5, 2015 Posted by | Uncategorized | , , , , , , , , , , , , | 2 Comments

War moves online

Most people know that the funding for the prototype of the internet (Arpanet) came from an agency within the US Department of Defense, and that one of the reasons for the decentralised nature of the network was to make it more robust in case of physical attack during wartime.

Therefore it is ironic that the underlying internet infrastructure is used as a platform for new kinds of attack, from cyber warfare by individual states and as a way of disseminating propaganda by terrorist organisations such as IS.

Of course, governments and terrorists have always aimed to use communication channels to get their messages across. Hence censorship in times of war, and even reporting restrictions during peacetime – I remember the ban on members of Sinn Fein (and other Irish republican and loyalist groups) from speaking on TV in the 1980s and 1990s.


Photo David Shankbone via Flickr

The internet, and more particularly social media, has opened up completely new ways of reaching audiences, and groups such as IS have been particularly strong at using these sort of channels. One study claimed that IS and its sympathisers controlled 90,000 Twitter accounts for example. Governments have tried to fight back, but the combination of the size and global spread of the internet and the difficulty of pinpointing specific individuals has made their job more difficult. The latest measures, recently announced by David Cameron, include ensuring that ISPs do more to remove extremist material and identify those that post it. However in a fast-moving world, the concern is that it is impossible for governments to move fast enough – as well as worries about the impact on free speech.

Some people are therefore taking action independently. Hacktivist group Anonymous is targeting alleged IS supporters online, recently publishing a list of over 750 Twitter accounts that it claims are spreading IS propaganda. It is also trying to take down Facebook pages, blogs and websites used by supposed supporters of the group. To try and influence search engine results it is flooding some Twitter accounts with images of Japanese anime character ISIS-Chan, making it more difficult for those looking for information from IS to find it.

I must admit that the attacks by Anonymous leave me in two minds. On one hand, anything that reduces the online footprint of a group that advocates cold-blooded killing of those that it disagrees with, can only be a good thing. But at the same time Anonymous is setting itself up as judge and jury – there is no right of appeal if someone innocent is targeted in error. It feels very much like the justice of the Wild West, perhaps because that is what many parts of the internet have become. For example, other groups linked to Anonymous recently took down the website of the Royal Canadian Mounted Police, after one of its officers shot and killed a protester, an action that could have hampered the ability of the public to find out information or potentially report incidents.

I’m sure Anonymous is confident in the information it is working with, and when it comes to IS its mission is laudable in many ways, and seems to be getting some results. But surely it is something that a combination of social networks and the authorities should be leading on? The real issue is that the majority of those with the technical skills to hack perceived wrongdoers don’t want to play by the rules – they’d much rather operate outside the law, rather than as part of it. The challenge for governments is therefore not only to persuade the online population of the dangers of IS, but to enlist the help of hackers to work with them more officially if they want to use their skills for good. That won’t be easy, but is vital if there is going to be a united front when it comes to the online War on Terror.

July 22, 2015 Posted by | Marketing, Social Media | , , , , , , , , , , , , , | Leave a comment

The battle for banking – Amazon enters the fray

In a previous post I talked about how the big four internet companies Google, Apple, Facebook and Amazon (GAFA) had quickly developed their businesses. They’ve all moved beyond the sector they started in, extending what they offer to compete with each other in areas such as ecommerce, social networks, mobile devices and mapping.amazon_logo_wb_2328

How have they done this? They’ve used the four strengths that they each possess:

1. Agility
With the exception of Apple, GAFA was born on the internet meaning they aren’t burdened with long-established corporate structures compared to their traditional rivals. So they can make decisions quickly, unhindered by the warring departments and turf wars that characterise first and second generation technology companies.

2. Data
Rather than purely physical assets, GAFA’s USP is data and what it does with it. From selling our search histories to monetising our personal pages, the four companies have built up extremely detailed pictures of their users and their lives. This allows them to accurately predict future behaviour – how many times have you bought something suggested by Amazon even though you had no idea it existed until the recommendation popped into your inbox? The advent of even cheaper machine learning and potentially limitless cloud-based resources to crunch data means that this is understanding is only going to get more precise.

3. Focus on the customer experience
Even though the majority of interactions don’t offer the personal touch of a bricks and mortar shop, these companies have gone out of their way to create a simple to use customer experience. Compare the Apple iPhone to previous ‘smartphones’ – the only difficulty for users was unlearning the convoluted way you had to access information on Microsoft or Nokia devices. I know, I had one of the first Windows phones – the user experience was terrible. Innovations such as one click ordering, reviews and simple sharing all mark out internet companies from their rival.

4. Scale
The final differentiator is scale – and the speed at which it is possible to grow on the internet. Rather than taking 20 years to become dominant in an existing market, companies can create a sector of their own and expand globally within months. Part of this is down to the network effect, but scale has also been achieved by moving into adjacent markets and just adding them onto the offering for existing users. This lowers the cost of entry for the company with the user base and creates a barrier to entry to rivals.

Taking these four factors into account, banks should be worried about Amazon’s latest move as it builds on all four of these strengths. Amazon Lending will make loans to small businesses in the UK that sell through the company’s Marketplace platform, after the service was successfully launched in the US. The beauty of the scheme is that Amazon knows exactly how the small business is performing as it can track their sales, and then use this data to offer selected companies short term working capital to improve their business. As it handles all the billing and cash collection for Marketplace sellers it can even take repayments directly from their profits, before they it pays them, minimising risk.

Adding to this data advantage, it is also offering the same simple to use customer experience that sellers are already familiar with. Compared to faceless or unhelpful banks, this is just the sort of thing that expanding small businesses are looking for.

The ironic thing is that, on the face of it, there is nothing to stop banks offering something similar. Their merchant services arms handle online and offline debit and credit card transactions, so they have access to data that could be used to work out creditworthiness. They have a network of branches to provide loans through, as well as a significant online presence. But all of these are separate departments and banks don’t have the agility to bridge the silos and provide the one stop shop that businesses are looking for.

In the same way that Apple Pay is disrupting payment services, Amazon Lending will take another bite out of the traditional business of big banks. And, as more and more of such services launch that nibble away at banking profits, then they face being outmanoeuvred by nimbler, more customer-focused and cleverer competitors. It is therefore time for retail and business banks to get joined-up or face becoming low margin commodity businesses in the future.

July 1, 2015 Posted by | Marketing, Social Media, Startup | , , , , , , , , , , , , , | Leave a comment

Apple: Do no evil?

English: Apple. Polski: Jabłko.

The technology world, outside China, is increasingly dominated by four companies – Google, Apple, Facebook and Amazon. They’ve even spawned their own, rather ugly collective acronym – GAFA. What’s interesting is that while all four have started from different places in the technology ecosystem they are now competing with each other in areas as diverse as smartphones and mobile devices (Android vs iPhone/iPad vs Kindle/Fire), mapping, and retail (especially music).

But the biggest – and most lucrative – battleground is digital advertising. Both Google and Facebook are using the huge amount of information they know about their users, whether through searches or their social media profiles, to target adverts so that they are more personalised and therefore more effective. In a less creepy way, Amazon analyses what you’ve already bought and suggests potential new purchases.

This reliance on consumer data, has led to issues, with users complaining about their privacy being invaded for example. Others have pointed out that with ‘free’ services like Facebook, the consumer becomes the product, with their data effectively paying for the access they receive.

Up until now GAFA have been pretty united in their use of consumer data and attitudes to privacy. This has now changed spectacularly with Apple CEO, Tim Cook, launching a blistering attack on his rivals, stating that “I’m speaking to you from Silicon Valley where some of the most prominent and successful companies have built their businesses by lulling their customers into complacency about their personal information.”

If that wasn’t direct enough an attack on Google and Facebook, he added, “We believe the customer should be in control of their own information. You might like these so-called free services, but we don’t think they’re worth having your email, your search history and now even your family photos data mined and sold off for God knows what advertising purpose.”

Before we hail Cook as a white knight of the IT industry, it is worth bearing in mind four facts:

  1. Apple has complex privacy policies just like the rest of GAFA
  2. Advertising is key to a large number of the apps within the AppStore
  3. Currently the default search engine in Apple devices is Google, so the company indirectly benefits from “selling off your search history”
  4. He was speaking to EPIC’s Champions of Freedom event, where he was honoured for corporate leadership – so he was hardly likely to speak positively about data-driven rivals.

Putting cynicism aside, there are two other reasons for Apple to embrace privacy and break from other members of the GAFA pack. Firstly, it made a profit of $13.6 billion in its most recent quarter, so it doesn’t really need to upset its more upmarket customers by selling their data for a (relative) pittance.

Secondly, and more importantly, Apple is now moving into new areas where security and privacy are everything – payments (with Apple Pay) and health (with a new ecosystem focused on wearables and sensors). Both of these are based on the most personal of personal data, where a single misstep would destroy consumer trust and essentially stop expansion in its tracks. It might even harm the overall Apple brand.

So Cook (and the rest of Apple’s strategists) have made a choice. They believe that people are happy to pay more for premium iOS products, on the understanding that their personal data will not be abused. It is in stark contrast to Google’s focus on mass market, cheap or free products where consumers pay by giving up control of their information. As the battle within GAFA rages, it will be interesting to see which side comes out on top in both the PR and sales wars.

June 17, 2015 Posted by | Marketing, PR, Social Media, Uncategorized | , , , , , , , , , | 1 Comment

Print engagement vs online eyeballs


Newspaper (Photo credit: Wikipedia)

In a previous blog I wondered whether the rise of technology would mean the end of interesting, creative ads, to be replaced by a combination of content-based marketing and basic, fast, algorithmic ads powered by our online behaviour.

I still believe that the ability for us to zone out ads on digital media (whether TV or the internet) means that brands are going to have to try harder to engage our attention on these channels. One area I didn’t talk about was print advertising in newspapers and magazines. After all most commentators have been saying for a while that the internet has pretty much killed off physical publications, with old media facing falling circulations and rising costs. But recently listening to Sir Martin Sorrell, the boss of advertising giant WPP, has made me think again. As a man who spends millions of client money on online and offline ads, he obviously knows what he is talking about, and he believes that while digital advertising may be getting the eyeballs, traditional media is getting the engagement.

He points out that having tens of thousands of Facebook Likes, mentions on Twitter or prominent online campaigns is meaningless if it is merely transitory and consumers simply skip onto the next big thing, without lingering over your message. Additionally, it is quite possible for online ad campaigns to be subject to clever frauds where views are artificially inflated to justify increased spend.

In contrast, offline readers spend more time reading a newspaper or magazine, including viewing the adverts, driving a deeper engagement that means both PR and advertising messages are more likely to be remembered. Obviously it still means the story or advert has to be memorable, interesting and targeted, but if it meets those criteria, it could do more for your brand than ten times as many online ads or mentions.

The other advantage of print is that, battered by digital, advertising prices have come down considerably over the past few years. This makes print more cost-effective than it was previously, adding another reason to invest in the channel.

The disadvantage of print is it is that much more difficult to measure who has seen your article or advert and how it has moved engagement forward. Clearly every reader does not read a paper cover to cover, including the ads, but there’s no set way of working out its impact. It is no coincidence that WPP has recently invested heavily in measurement technology as this will be key to really demonstrating engagement – both on and offline. In the past print measurement, particularly for PR, was incredibly vague. For many years the standard way of demonstrating PR ‘value’ for a particular piece of coverage was to take the equivalent cost of the same size advert and multiply it by three as editorial was deemed much more believable by readers. Thankfully those days have gone, but it does leave a gap. By contrast you can measure everything online – but sheer numbers don’t tell you everything, particularly about engagement.

What is needed is a new approach that can link the two – but in a way that isn’t intrusive, respects user privacy, and doesn’t involve in extra work for the publication, brand or reader. Google Glass would have met some of these needs, but certainly didn’t tick the privacy box. So, the search goes on – but until then, marketers should bear in mind that eyeballs don’t equal engagement and choose their media channels accordingly.

June 3, 2015 Posted by | Creative, Marketing, PR | , , , , , , , , , , , , | Leave a comment

Ten lessons from ten years of YouTube

Español: Logo Vectorial de YouTube

This year YouTube celebrates its tenth anniversary. Originally founded in 2005 it has grown to have over 1 billion users, with 300 hours of video currently uploaded every minute of every day. For those without a calculator that’s 432,000 hours of new content every day.

Available in 70 countries and languages it made its founders $1.65 billion when Google bought the site back in 2006. At the time many thought they were mad, but the phenomenal growth and the amount of user data that it provides to Google has proved the doubters very wrong.

So what can startups and marketers learn from YouTube and the growth of video more generally? To mark ten years of YouTube, here are ten lessons I’ve drawn from its success:

1. Don’t always follow the rules
One of the big issues with startups in new markets is that existing legislation doesn’t cater for their disruptive power. Think of Uber and Airbnb and the regulatory issues they are having as they look to sidestep rules governing taxis and accommodation respectively. With YouTube and other video sites that launched at a similar time the big issue was users uploading copyrighted material. Competitors protected themselves by checking content before it was uploaded – slowing down their growth and adding to their overheads. In comparison YouTube let users upload anything and then took it down if lawyers or rights holders complained. This gave it a key differentiator, attracted more users and reduced its costs.

2. It is all about You
Despite the growth of brands on the site, the vast majority of content on YouTube is still created by amateurs. By giving a platform for everyone to easily share video, YouTube has been part of a democratisation of the web – as shown by the viral success of many of its videos, and the helping hand it has given to the careers of artists and bloggers such as Psy, Ed Sheeran, Zoella and many others. Brands trying to connect with audiences on YouTube need to understand that it is a two-way street – it isn’t just about providing your own content, but encouraging consumers to work with you and share what they are doing if you want to increase engagement.

3. Video is worth 10,000 words

It may have taken a few years for broadband and mobile data speeds to be able to comfortably cope with streaming video, but now it is the medium of choice for many. If a picture is worth a 1,000 words, video is at least 10x as effective as it allows people to see what is happening, rather than relying on words or static images.

4. It isn’t just cute cats
A few years ago I did some market research with C-level executives to find out where they got information from. The big surprise was that YouTube featured highly in their responses. But a quick look at some of the business content on the site – from the Harvard Business Review to TED talks and The Economist – shows that there’s plenty for any audience to learn from YouTube, whatever demographic they are part of.

5. It can be monetised
People do make money from YouTube. Aside from the celebrities and stars that have used the channel to launch themselves, owners of popular channels are able to make money from the ads around their content. The targeted audiences YouTube delivers (thanks to Google’s knowledge of viewer’s demographics), make it an important way for marketers to reach the right people quickly and easily.

6. Media has become multimedia
Ten years ago there was a sharp divide between traditional print media and the broadcast world. The combination of YouTube and cheaper, higher quality video cameras (or even just smartphones), mean that any journalist or publication can create and upload multimedia content quickly and easily. From interviews to reports, people now expect to see embedded video on news sites, with most media outlets now having their own YouTube channel to host and share content.

7. YouTube is the back end, not just the front end
For every video accessed directly on the site, many hundreds more are reached through other sites. Essentially YouTube provides a complete infrastructure for brands to set up their own channels, for free, and then embed links in their own site or other media. Again, it makes it easy for companies to share video, on or off the site.

8. Attention spans are shorter
People, particularly on mobile devices, are increasingly browsing video content, rather than settling down to watch it for a long time. While there are plenty of exceptions – my children would watch 10-15 minute videos of Stampylongnose playing Minecraft all day – most people don’t want to watch long form content on YouTube. So videos need to be short, snappy and broken up into bite size chunks if they are to be watched and shared.

9. Showing is easier than telling
Doing a DIY job used to involve poring through a manual or asking friends and family for advice. Now you simply go onto YouTube and watch a professional doing it, explaining as they go. The same applies to lots of jobs and hobbies, and with YouTube results prominently displayed in Google searches, it has never been easier to work out how to do something for the first time.

10. Innovation is constant
YouTube may be ten, but it still faces challenges. Facebook is looking to compete by making it simple for its users to share videos on the network, while streaming music services are waking up to the amount of music content watched on the site. Recently Snapchat announced that it has 100 million users watching 2 billion mobile videos every day. The shift to mobile and the fact that as video grows up it becomes more of a commodity means that YouTube needs to constantly evolve if it is to remain relevant.

Ten years is a long time in tech and social media, and the growth of YouTube shows how it has managed to build a brand by understanding what people want and giving them a platform to share. It will be interesting to see what the next decade brings – hopefully not another Justin Bieber………….

May 27, 2015 Posted by | Creative, Marketing, PR, Social Media, Startup | , , , , , , , , , , , , , , , | Leave a comment

Hunting for unicorns

Mankind has always had a fascination for mythical beasts, and none more so than the unicorn. Despite allegedly dying out in the flood after failing to board Noah’s Ark in time, they are still all around us in popular culture, from Harry Potter to children’s toys. I even found an exhibit in a Vienna museum labelled matter of factly as a “unicorn horn” – it was actually from a narwhal.unicorn

The horned horses are back in the news, in the world of tech at least, with any startup valued at over $1 billion by venture capitalists now dubbed a unicorn. However with more than 100 companies now achieving unicorn status there’s a growing worry that startups are trading short term valuations for longer term success. True, unicorn status helps attract skilled staff, but down the line it requires either a trade buyer that is willing to pay big money or an IPO to translate mythical (paper) valuations into hard cash. There have also been a raft of stories on how investors have structured their unicorn funding in ways that protect their cash (rather than the shares of others, such as founding teams) if the company should lose its value.

A focus on unicorns also favours certain sectors and types of company. A browse through Fortune’s latest unicorn list reveals a large number of consumer electronics (Xiaomi, Jawbone), retail (FlipKart, Snapdeal) and sharing economy (Uber, Airbnb) companies. In many ways this is what you expect – company valuations are based on what the addressable market is, so the biggest investment goes into those startups that can make most money.

However, it does potentially limit where investors put their money. There are lots of startups that will never be a Facebook or an Uber, but have the potential to be extremely successful niche players that could well grow into billion dollar valued companies. Look at ARM – when it began as a spin-off from Acorn Computers with a completely new business model, very few would have predicted its current success.

There’s also a definite geographic bias where unicorn investors are putting their money – Silicon Valley, China and India. Out of the latest Fortune list just three are in Europe, one in Australia and one in Israel. This doesn’t reflect the energy, ideas and potential in any of these places, particularly in emerging sectors. The danger is that if investors spend their time chasing unicorns they’ll miss out on the startups that could do with their help to build long term businesses that can make a difference to many markets.

So I think we need to add another category alongside unicorns. Keeping the mythical theme I’d go for centaurs. Sturdier than a unicorn, probably better in a fight and with a bit more intelligence (and opposable thumbs). They may not have the beauty or the (frankly over the top) horn of their flashier cousins but they are built for the long term, rather than mythical valuations that don’t necessarily deliver. Given the potential returns they can produce, it is time for investors to move away from the fascination with unicorns to more realistic startups that may be uglier, but have just as much potential.

May 20, 2015 Posted by | Cambridge, Startup | , , , , , , , , , | Leave a comment


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