Blogging IS serious business....

The Federal Trade Commission has made public its first investigation into a company's relationship with bloggers, and while the federal agency took no action, the decision provides some insight into how it is viewing marketers' relationships with online communities.

The FTC informed Ann Taylor that, following an investigation, it has decided not to take action against the women's retailer over an event held earlier this year. The retailer had invited bloggers to preview the Loft division's summer 2010 collection, offering a "special gift," and promising that those posting coverage from the event would be entered into a "mystery gift-card drawing," where they could win between $50 and $500.

The invite explained that bloggers must submit posts to the company within 24 hours in order to find out the value of their gift card.

The event and the unusual request for posts to be submitted for a prize received media scrutiny and caught the eye of the FTC. "We were concerned that bloggers who attended a preview on January 26, 2010 failed to disclose that they received gifts for posting blog content about that event," Mary Engle, the FTC's associate director-advertising practices, wrote in a letter dated April 20 to Ann Taylor's legal representation.

Although the agency decided not to take action against Ann Taylor, the case serves to let marketers know that the FTC is keeping a close eye on their interactions with bloggers.

Getting the message out
"This tells me that [the FTC] is looking, and that's important to know," said Douglas Wood, an attorney and head of Reed Smith's Media and Entertainment Industry Group. "They're probably throwing a little fire-starter into it, sending some messages out. The message this time is somewhere between $50 and $500 requires a disclosure."

Last year the agency began cracking down on bloggers, issuing new guidelines requiring bloggers to clearly disclose any "material connection" to an advertiser, including payments for an endorsement or free product.

The FTC said it decided not to take action against Ann Taylor, because, according to the company, the January preview was the first and, to date, only such event. Also, only a small number of bloggers posted content about the preview and several of those disclosed the gifts. A sign posted at the event directed bloggers to disclose the gifts, though the FTC says it's not clear how many bloggers saw the sign. Finally, Ann Taylor's Loft division adopted a written policy regarding its interaction with bloggers in February.

According to a spokeswoman for the FTC, the retailer was cooperative during the process. Ann Taylor declined to comment.

Industry watchers have widely expected the FTC to make an example of a company, in its quest to give the new guidelines teeth. The FTC declined to comment on any additional investigations that may be underway.

"I'm speculating, but what the FTC is doing is not being aggressive intentionally, so they can set up a standard they think is appropriate. Maybe they'll do this a few more times," said Mr. Wood. "It's not an unusual way to begin the educational process. In a way, it's always good to be the first one looked at. The second one might not fare so well."

Words of Wisdom....

Director of Marketing, SOBE:

"Those relationships that allow for change as culture and climate evolve should be fine. I am a firm believer in flexibility in this economic environment and in this consumer-led environment. The agency-marketer relationships that build in flexibility have a greater chance for success."

Happy Birthday Coke 2....that concept is still number 2.

Today marks a quarter century of one of marketing's biggest blunders -- and the sixth biggest moment in 75 years of advertising, according to Ad Age: New Coke.

Still smarting from the 1975 "Pepsi Challenge" taste-test battle, Coca-Cola Co. launches "Project Kansas," a top-secret mission to reformulate Coke. President-Chief Operating Officer Robert Goizueta appoints Coca-Cola USA head Brian Dyson, who taps marketing chief Sergio Zyman to head the endeavor. Mr. Zyman and company test a new, sweeter version of the flagship cola with 190,000 nationwide taste tests at a cost of $4 million.

At a bottlers' meeting in Atlanta back on April 22, 1985, Mr. Zyman announced from the stage that Coke was changing its taste. The next day Coca-Cola revealed the new, sweeter taste to financial analysts and the media. But word of the new product finally leaks out and Pepsi dispatches its own press assault on the same day claiming victory. "The other guy blinked," Pepsi says in ads saying Coke reformulated its brand to taste "more like" Pepsi.

The press hammers at Mr. Goizueta, now chairman-CEO, to explain the difference and what will happen to the old Coke, which 39% of consumers still favor. When Mr. Goizueta admits it will do away with the old formula, consumers revolt. Dazed by the backlash, management on July 11, 1985, just 79 days later, agrees to bring back the original formula, renaming it Coca-Cola Classic.

Some in the industry counterintuitively suggested the blunder was actually good for the beverage giant -- that its fans' reactions to the idea of their beloved Coke going away, along with the reintroduction of the cola as Coca-Cola Classic, have created a fantastic new marketing strategy. But we think the lesson is pretty clear: Don't tinker with success. Or at least think very, very carefully before you do.

How advertisers are following your purchase pattern...

Imagine signing in to your online-banking account and finding promotions linked to your transactions. Underneath a transaction for a restaurant, there's an offer from that eatery for $10 cash back when you spend a minimum of $20. And underneath a purchase at an apparel chain, a rival offers 15% cash back for shopping at its store or website.

REWARDS: Cardlytics offers take the form of consumer rewards.

It may seem intrusive, but Cardlytics, the company behind the program, claims that advertisers, consumers and financial institutions are fast embracing this new advertising model. So far, major marketers such as McDonald's, Macy's and Staples have signed on with Cardlytics, while half a dozen financial institutions have implemented the service and are touting it as a rewards program for their customers.

In all, Cardlytics, a privately held company that officially launched the program last November, says it has run more than 100 marketing campaigns reaching nearly half a million customers. By the end of the summer, the company expects to have 50 to 70 financial institutions on board, reaching some 10 million customers by the end of the year.

"It's a whole new channel," said Hans Theisen, chief revenue officer. "It eliminates so much waste. I don't care whether it's digital, TV or print. You're not guessing about who your audience is. I can guarantee you're reaching a fast-food customer or apparel shopper or moviegoer."

Mr. Theisen can guarantee that because Cardlytics is privy to transaction data: the name of the merchant, date of the purchase, how much was spent and the customer's ZIP code. But it does not have access to personally identifiable data like customer names, account numbers or home addresses, which are managed by participating banks. Because of that, he downplays privacy concerns, noting that Cardlytics goes through "lots and lots" of regulatory steps in order to work with financial institutions. Customer information remains behind the bank's firewall.

Privacy "is always the first question we get, and it's the easiest to answer," he said. "We don't get privacy information. We don't cookie customers and follow them around the web. It's less infringing upon a customer's privacy than many behavioral-targeting companies."

Opt-out
Though customers have the ability to opt out of the program, opt-out rates across Cardlytics program have been less than 5%, said Mr. Theisen, about two-thirds less than the 12% to 15% opt-out rate the company modeled for.

Here's how it works: When a bank customer signs in to view his or her online statement they can see various reward offers in three places, alongside transactions, in a column on the transaction page or on a rewards-summary page. To activate the offer, they must click, and once the reward is activated, it is automatically converted when the consumer uses his or her debit or credit card at that merchant and the transaction is processed by their bank. No special software or interaction is necessary on the part of merchants. And because the program uses transaction data from debit cards and credit cards, the ads on the online statement are applicable to transactions made online or offline.

Cardlytics operates under a pay-for-performance model, so it gets paid only when consumers redeem an offer. Payment to Cardlytics varies based on client category and the type of offer, though advertisers receive a projection. Cardlytics declined to offer specifics on advertiser fees and said it could not legally share details on its financial arrangements with banks.

Aaron McPherson, an analyst focusing on payments and security technology at IDC Financial Insights, said that, from a security perspective, the Cardlytics program is not any riskier than other card-based rewards programs. Banks, he added, have always had the ability to target consumers based on the transactions they're making, they just haven't done it.

"Are consumers going to be freaked out by this? It's one of the reasons why banks have not historically been willing to go there," he said. "Banks have to be careful to position this as an opportunity."

"Full Service" Ad Agency is a Meaningless Phrase

So you want to be fast, agile and digital? Jason Fried suggests agencies take a page from his Jason Fried's book.

Mr. Fried, co-founder and president of software company 37signals, let loose on agency folks today at the Ad Age Digital Conference in New York, addressing one of the biggest issues facing agency adaptation to the digital world: specialization. Too many agencies, in trying to be all things to all marketers, and getting bogged down and doing a disservice to themselves and their clients.

Mr. Fried was interviewed by Ben Malbon, executive director of innovation for Bartle Bogle Hegarty, New York, who pointed out that "from an agency point of view, there isn't a good agency out there that isn't working out how it can be better." Out of the discussion came five tips for staying nimble in the digital age.

Focus on what works

While it might be tempting to take on a client's entire business, there's no way one agency can do everything well. "It's really easy to do too much," said Mr. Fried, who often echoed the book he co-authored, "Rework."

"Agencies listen to their [clients] too much. When you listen to your [clients] you starting wanting to do too much. That's when you start doing things you don't believe in."

Stick with what you know

Instead of trying to manage "full-service end to end" -- a term Mr. Fried finds somewhat meaningless -- he urged focus and specialization. He pointed to 37signal's history, as it started out as an agency and web-design firm and ultimately evolved into a software shop. "We were going to 'underdo' everybody else," he said.

"I don't think people should do things they don't understand," said Mr. Fried, in response traditional agencies' attempts to add digital. Even digital agencies, such as SapientNitro and R/GA, have been adding "traditional" services to their already strong digital offerings in the last year. "Companies end up hiring people to do these things they don't know how to do, they get really big and then they slow down. That's how you get big and slow and expensive. What's wrong with doing just a few things really well?"

Don't sell the steps

Mr. Fried pointed to multiple approvals as another culprit that slows down the process. While it's lucrative for agencies to get big fees for big projects, does a client really need so many steps?

"If you stop promising things, you don't have to deliver them," he said. "All people care about is the end product."

Grow slowly to deliver faster work

When it is time to grow, Mr. Fried cautioned against staffing up too fast. "It's important not to hire in anticipation of work," he said. "Feeling like you want to do more and not being able to, I'm okay with that. You are better hiring to alleviate pain than to hire for pleasure."

Bite off only what you can chew

To keep projects on schedule, Mr. Fried suggests breaking up a giant project into manageable pieces. When one $100,000 project is broken up piecemeal, each chunk has a better chance of being on time.

"It's the agency's fault when projects run long; I don't think it's the clients fault," he said. "Work on short-term projects. What can you accomplish in two weeks?"

He points to a project that his company cut down into one-page, $3,500 per piece chunks. "Instead of doing the big huge mega-product like agencies, do one page in one week."

He added: "Cut it down as small as you can and price it piecemeal. ... Have confidence in your work. [Clients] are going to keep wanting it because it's good."

Yes, Media Spending DOES actually work....

When one thinks of the largest marketing spender in the U.S. food industry, Kraft easily comes to mind. But when it comes to naming No. 2, the answer might come as a surprise: General Mills.

The marketer of Cheerios, Pillsbury, Yoplait and Betty Crocker has become a stalwart of the Great Recession, thanks to increased spending, but also product innovation and its ability to capitalize on the trend toward in-home eating.

For the third fiscal quarter of 2010, General Mills saw sales rise 3% to $3.6 billion, and in the U.S. sales rose 4% in the first nine months of fiscal 2010 to $7.9 billion.

The marketer posted an impressive 33% jump in advertising and media spending. Stifel Nicolaus analyst Chris Growe noted that "General Mills has quickly reached a critical mass in its marketing spending that vaults it up to the second-highest marketer within the food industry" behind only Kraft. And it might even be closing in on the leader: According to an Ad Age estimate, General Mills spent $1.2 billion on advertising alone during 2008, a 23% increase over the year before, just below the $1.3 billion Kraft spent on advertising during 2008, a 16% decrease from 2007.

"We are first and fundamentally about brands," CMO Mark Addicks said, "and I feel good about the brands and the growth ideas about each [of them]."

The real challenge in this recession, Mr. Addicks said, has been to demonstrate each brand's value and purpose as well as versatility. To wit: The company's new chocolate Cheerios, for instance, are proving popular not only as breakfasts, but as snacks and desserts.

These days, he said, consumers are asking, "What role do you play in my life, and what value do you give me? I'm proud of our business teams and the ways they're answering that question and playing more of a partnership role with our consumers in their lives."

Uh-oh...someone got caught with their hand in the media cookie jar...

Ad Network And Publishers In Mediaweek

Following last week's article in which Mediaweek reporter Mike Shields identified several publishers who claimed that ad network, InterCLICK, had misrepresented their inventory, this week, each is given the Mediaweek microphone to state their case. Read more. InterCLICK quotes Razorfish VP of search marketing, Matt Greitzer, who says that many of the publishers mentioned in the article are available through the DoubleClick Ad Exchange. Among the publisher responses, theStreet.com claims their inventory had been misrepresented by InterCLICK, and Todd Haskell, VP of sales and ops at The NY Times says, "It is impossible for an ad network to deliver any impressions [against NYT inventory]. Any assertion otherwise is incorrect."

What Will Social Media Look Like In the Future?

It's easy to get caught up in today's trends or even focus on the next six months. Some of 2009's biggest trends included an increased emphasis on real-time search and information distribution, while distribution of marketing content in widgets and other pieces of portable content that worked across devices and social spaces also saw its stake rise. Plus, there were great improvements in social-media monitoring and analytics. And most notably, marketers finally acknowledged that social media was more than just a fad, with almost complete adoption by all major marketers.

Here are the top 11 predictions for what social media will look like in 2012. Some of these items exist today in their early stages, but this list is about what I believe will become the norm in 2012. Ultimately, share of voice, point of view and community influence will be more important than brand ownership -- and marketers will need to get over it if they want to stay relevant in 2012.

1. Privacy expectations will (have to) change
There will be a cultural shift, whereby people will begin to find it increasingly more acceptable to expose more and more of their personal details on different forms of social media. Sharing your likes, dislikes, opinions, photos, videos and other forms of personal information will be the norm and people will become more accepting of personalized experiences, both corporate and personal, that are reacting to this dearth of personal information.

2. Complete decentralization of social networks
The concept of a friend network will be a portable experience. You'll find most digital experiences will be able to leverage the power of your social networks in a way that leverages your readily available personal information and the relationships you've established. We're already seeing the beginnings of this with Facebook Connect and Google's FriendConnect.

3. Our interaction with search engines will be different
Real-time information in Google search, e.g. from Twitter, blog results and user reviews, will be more prominent. Google's Social Search will change the way we interact with search engines by pushing relevant content from our personal networks to the front of search results, making them more personalized. The importance of digital-influencer marketing will increase significantly.

4. Rise of the content aggregators
The amount of content online is growing at an exponential rate, and most online users have at least three online profiles from social networks to micro-blogging to social news sites. Our ability to manage this influx is challenging, and content aggregators will be the new demi-gods, bringing method to madness (and make a killing). Filtering and managing content will be big business for those who can get it right and provide easy-to-use services.

5. Social media augmented reality
Openly accessible information from the social-media space will be used to enhance everyday experiences. For example: the contacts book in your phone links to Facebook and Twitter to show real-time updates on what the contact is doing before you put in the call, real-time reviews from friends and associates will appear in GPS-based mapping services as a standard feature, and socially enabled CRM will change the way companies manage business relationships forever.

6. Influencer marketing will be redefined
As social media continues to permeate more and more aspects of not only the way we interact with digital media but also other channels such as digital outdoor, commerce or online TV, we will see the significance of influencer marketing grow dramatically. As a basic example, the inclusion of Twitter in Google search results or Google's soon-to-be-released Social Search will permeate search results with content that will not be managed by Google's infamous PageRank but by social influence and relevance to your social network. Discovering people that can help you to reach your desired consumer will become exponentially more effective and important.

7. Ratings everywhere
In today's world, having a commerce site that doesn't have user ratings could actually prove to be a detriment to sales. In the near future, brands and businesses will more frequently place user ratings and accept open feedback on their actual websites. User ratings will become so common that marketers should expect to find them woven into most digital experiences.

8. Social media agents
Managing the customer experience offline and online is already a key concern for marketers and customer-experience advocates. As businesses continue to support customers by monitoring and engaging in the social media space, tools to optimize this experience will become more important. Expect to see a certain percentage of responses handled by natural language engines that can respond to basic commentary such as "my service is down" or "I never received my package."

9. Riding the (Google) wave
It's still early days as Google Wave is still primarily limited to developers but it has the potential to revolutionize collaboration and engagement. Wave offers marketers a unique way, at minimal cost, to allow consumers to engage with each other in way that is miles beyond anything we're currently using. Savvy marketers will develop extensions for Wave that evolve its unique communication toolset into a rich brand experience that is immersive but allows for new levels of interaction from crowdsourced storytelling to crowdsourced product design.

10. Thinking beyond "nowness"
In 2009 we became very focused on the real-time nature of social media. The implications behind consumer feedback and interaction around brands using tools like Twitter or Facebook's news stream caused marketers to re-evaluate the power of social media tools in parallel to "traditional" digital-media channels such as search. Looking into the future we'll need to try and evaluate what's next and the likely answer is based on the next evolution of the web as we know it: the semantic web. In a semantic web world, search engines, for example, will anticipate the best search results we're looking for based on what they know about us (such as all our public social networking profiles). There will be an opportunity for marketers who push the limits of their imagination to anticipate what marketing will look like in this next stage of the web and creating new and compelling experiences that we're only touching the surface of now.

11. Social media everything and the return of digital media
Social functions will become so commonplace in digital experiences that the thought of not having socially-enhanced experiences will seem illogical. Digital media by its very nature is inherently social. I hope we're not talking about social media in 2012, and we just refer to everything as digital media again.

Even the biggest get it wrong sometimes....

Yahoo is closing down its text-advertising network, ceding the market to already-dominant Google, as it retools to focus on premium display.

The Yahoo Publisher Network Beta, a text-ad service for small sites and blogs, will shut down as of April 30, according to a memo sent to publishers, which were directed to the Chitika ad network, which set up a welcome page for former Yahoo clients.

Yahoo's Publisher Network, known as YPN, is the company's version of Google's AdSense, one of three types of ads it places on third-party sites including search ads and display ads through Yahoo Network, which includes premium Yahoo inventory as well as inventory from third parties such as eBay and Comcast. Yahoo also operates display ad server APT, which serves many large U.S. newspapers.

Small publishers could sign up for the beta program on an invite-only basis, and get text ads targeted to the content on the page, as well as some ad revenue. Compared to display, text ads are a tiny business for Yahoo, one that most brand advertisers won't miss.

"That was the poor man's AdSense, and something brands generally avoided so for them this is a nonevent," said Bryan Wiener, CEO of 360i, now a unit of Dentsu.

A Yahoo spokeswoman said a "small group" of publishers were using the service. Yahoo under CEO Carol Bartz has been trimming back its portfolio to focus on the premium display ad market, including repositioning the Right Media exchange on the high end by eliminating some ad network inventory.

Yahoo declined to say how much revenue was associated with the network, but the program still carried a "beta" moniker even though it had been in existence for years.

"After conducting an extensive review of the Yahoo! Publisher Network beta program, it was determined that the resources that would be required to advance the program to the level expected by our publishers would be better utilized in other areas of Yahoo!'s business," Yahoo said in a statement.